Eugene Investment & Securities reiterated its "Strong Buy" rating and target price of 560,000 won on Samsung Electronics on the 6th, implying upside of more than 80% from the stock's closing price of 309,500 won on the 3rd.
The brokerage forecasts Samsung's second-quarter revenue at 168.1 trillion won, up 26% quarter-on-quarter, with operating profit rising 45% to 83.1 trillion won. The DS (Device Solutions) division — which houses Samsung's semiconductor business — is expected to drive the group's earnings growth, contributing 81.6 trillion won in operating profit, a 52% sequential increase.
Within the memory segment, intensifying competition among customers to secure inventory is expected to strengthen Samsung's pricing power, with operating profit projected at 83.1 trillion won. Negotiations for third-quarter contract prices are reportedly under way, with average selling prices (ASPs) for both commodity DRAM and NAND flash set to rise by more than 20%.
Not all divisions are faring as well. The foundry and LSI (system semiconductor) unit is unlikely to return to profitability this year, weighed down by bonus-related provisions. The MX (mobile experience) and network businesses face margin pressure from rising memory input costs, with operating profit expected to fall 71% to just 800 billion won.
Looking further ahead, Eugene projects Samsung's operating profit will reach 361.3 trillion won in 2026 — a 726% increase year-on-year — before rising a further 63% to 589.4 trillion won in 2027. The brokerage also expects the memory industry's shareholder-return competition to intensify in the second half of this year, with Samsung directing roughly 50% of its annual free cash flow towards share buybacks and cancellations.