KB Securities Says Samsung, SK hynix Trade at Crisis-Level Valuations
KB Securities reports Samsung Electronics (005930) and SK hynix (000660) trade at crisis-level valuations, with P/E ratios around 3x. The firm forecasts combined operating profit of 1,571 trillion won for 2023-24, up 51% and 50% YoY respectively. Foreign ownership is at 2008 crisis lows. Market sentiment may be shifting, with Citadel and Nvidia executives expressing optimism.
How this was made
The 30-second read
Why it matters
The note provides fresh profit forecasts and valuation metrics, creating a new catalyst for investors to consider buying the undervalued stocks.
Market read
The report may trigger buying interest in two major Korean chipmakers, potentially lifting their shares and influencing the broader semiconductor sector.
What to watch
Foreign ownership levels remain low, which could constrain capital inflows and affect price recovery.
Background
KB Securities released a research note highlighting severe valuation discounts for Samsung and SK hynix relative to earnings growth.
Ticker impact
KB Securities reports Samsung Electronics' P/E fell to about three times, indicating severe undervaluation versus earnings growth.
likely upward pressure as investors price in the valuation gap
The report provides fresh profit forecasts and a valuation gap not previously disclosed, implying a catalyst for buying.
KB Securities notes SK hynix's P/E also near three, with operating profit projected to rise 50% YoY, signaling undervaluation.
likely upward pressure as valuation gap narrows
New profit forecasts and valuation metrics are disclosed for the first time, offering a fresh trading angle.
Market effects
Chip sector may see broader re‑rating if two leading memory makers are deemed undervalued.
South Korean equities could benefit from renewed interest in memory manufacturers.
Potential spillover to global semiconductor supply chain investors.
Counterpoint
If AI spending slows, memory demand could weaken, limiting upside despite low valuations.
Key entities
- Research FirmKB Securities
Issuer of the valuation report.
- CompanySamsung Electronics
South Korean memory and electronics giant.
- CompanySK hynix
South Korean memory chip manufacturer.
