Brokerages are raising earnings forecasts and price targets for Samsung Electronics, citing strong momentum in AI-driven memory demand and growing expectations for long-term supply contracts with major tech firms.
On Tuesday, KB Securities raised its 2026 operating profit forecast for Samsung Electronics and set a target price of 360,000 won ($245), one of the highest among local brokerages.
Kim Dong-won, head of research at KB Securities, said requests from Big Tech firms for five-year, long-term agreements suggest a prolonged structural supply shortage in memory through 2030.
“Strategic collaboration with major clients from the early stages of AI memory development is strengthening, and the memory industry is evolving toward a foundry-like structure,” Kim said, adding that this could drive a mid- to long-term valuation rerating.
He also noted that Samsung shares remain undervalued, trading at about 4.5 times forward price-to-earnings and 1.7 times price-to-book ratios, arguing that concerns over peak earnings are premature given further upside potential.
NH Investment & Securities also raised its operating profit estimate for Samsung and lifted its target price to 290,000 won from 260,000 won.
Analyst Ryu Young-ho said long-term contracts should not be viewed simply as pricing mechanisms but as strategic agreements reflecting increasingly complex data center hardware planning and alignment between suppliers and customers.
“The details of these contracts will likely become a key variable for Samsung’s share price going forward,” he said.
Daol Investment & Securities raised its target price to 350,000 won from 290,000 won, while taking a more cautious stance.
Analyst Ko Young-min said while long-term agreements may not guarantee midterm cycles for conventional memory, they remain supportive under current conditions.
“Customers are still absorbing elevated memory prices, but there are limits,” he said. “Setting quarterly price ranges helps improve visibility, and we see upside in prices at least through year-end.”
By Jeon Ji-woo (jwjeon7625@heraldcorp.com)
