The estimated operating profits of Samsung Electronics for the first quarter of this year, which recently dropped to slightly over eight trillion won, has been adjusted upward to close to 8.5 trillion won (US$8.02 billion). Foreign investors are continuing to purchase Samsung Electronics shares, looking forward to an improved performance, to cause the price to rise for four consecutive sessions.
Still, some stock firms are adjusting their target stock prices downward in spite of the better estimate, because the display and semiconductor business units of Samsung are showing less-than-expected performance amid the deteriorating business conditions as of late.
Financial market participants’ consensus for Q1 is 54.6642 trillion won (US$51.5483 billion) in sales and 8.449 trillion won (US$7.967 billion) in operating profits. The former increased 3.4 percent, whereas the latter declined 3.76 percent from a year earlier.
Korea Investment & Securities adjusted its forecast upward on March 28 from 50.7 trillion won and 8.1 trillion won to 53.8 trillion won (US$50.7 billion) and 8.14 trillion won (US$7.68 billion). KTB Investment & Securities also raised the figures by 2.3 and 0.4 percentage points each to 54.1691 trillion won (US$51.0815 billion) and 8.461 trillion won (US$7.979 billion).
“Although the Galaxy S5 is slated to be launched on April 11, Samsung Electronics is expected to have already broken the one million unit mark in sales volume in March,” said Korea Investment & Securities, adding, “Under the circumstances, the IT & Mobile Division of Samsung Electronics alone is forecast to have reached 5.78 trillion won [US$5.45 billion].”
Nevertheless, some securities companies suggested lower target prices for Samsung Electronics shares. For instance, KTB Investment & Securities cut the price 16 percent from 1.9 million won to 1.6 million won (US$1,508.80) with the earnings per share (EPS) and the book value per share (BPS) estimates lowered 2.4 percent and 2.6 percent, respectively. The company adjusted its turnover and business profit estimates downward by 0.3 percent and 6.5 percent each, too.
NH Investment & Securities cut the target price from 1.8 million won to 1.7 million won (US$1,603.10) as well on the analysis that the Galaxy S5 has had less impact on the market than the previous model.