[Featured Stock] Samsung Electronics Plummets on Earnings Forecast Below Estimates

The appearance of Samsung Electronics headquarters in Seocho-gu, Seoul [Image source=Yonhap News]

On the 9th, Samsung Electronics experienced a sharp decline immediately after the market opened. This is interpreted as a result of weakened investor sentiment due to expectations that the third-quarter operating profit will fall short of market forecasts.

As of 9:04 AM, Samsung Electronics was trading at 66,800 KRW, down 3.05% (2,100 KRW) from the previous trading day.

On the same day, KB Securities lowered Samsung Electronics' target price to 95,000 KRW, citing delayed recovery in DRAM demand due to sluggish smartphone and PC sales. Dongwon Kim, a researcher at KB Securities, analyzed, "Due to weak smartphone and PC sales in the third quarter, inventory levels at memory module companies have increased to 12-16 weeks, causing memory shipments and price increases in the second half of the year to fall short of expectations."

He added, "Smartphone and PC companies are currently experiencing lower-than-expected demand for new products in the third quarter, so they are expected to adopt a conservative strategy for purchasing components, including memory, in the second half of the year."