KB Securities: Samsung and SK Hynix shares are as undervalued as they were during the global financial crisis
KB Securities, one of South Korea’s leading brokerages, has issued a new assessment: Samsung Electronics and SK Hynix shares are now as undervalued as they were during the global financial crisis. Profits at both companies are surging, but their share prices have yet to follow suit.
Although Samsung Electronics and SK Hynix shares have risen 65% and 88%, respectively, since the start of this year, as of the close on October 23, they were still down 36% and 52%, respectively, from their late-June highs. In a report published on October 26, Kim Dong-won, head of KB Securities’ research division, noted that the two companies’ price-to-earnings ratios had fallen to around 3 times.
Both companies will release their third-quarter earnings this week, with combined operating profit for the quarter expected to reach 184.4 trillion won (about $139.1 billion). Investors will focus on three key points: HBM4 supply, progress on long-term agreements, and shareholder return policies.
The report has undoubtedly sounded an alarm for the market: “prices up, profits down”—hardware earnings are soaring, so why do the share prices seem as inconspicuous as pedestrians crossing the street? The answer may emerge when the earnings are released.
KB Securities, one of South Korea’s leading brokerages, has issued a new assessment: Samsung Electronics and SK Hynix shares are now as undervalued as they were during the global financial crisis. Profits at both companies are surging, but their share prices have yet to follow suit.
Although Samsung Electronics and SK Hynix shares have risen 65% and 88%, respectively, since the start of this year, as of the close on October 23, they were still down 36% and 52%, respectively, from their late-June highs. In a report published on October 26, Kim Dong-won, head of KB Securities’ research division, noted that the two companies’ price-to-earnings ratios had fallen to around 3 times.
Both companies will release their third-quarter earnings this week, with combined operating profit for the quarter expected to reach 184.4 trillion won (about $139.1 billion). Investors will focus on three key points: HBM4 supply, progress on long-term agreements, and shareholder return policies.
The report has undoubtedly sounded an alarm for the market: “prices up, profits down”—hardware earnings are soaring, so why do the share prices seem as inconspicuous as pedestrians crossing the street? The answer may emerge when the earnings are released.