Samsung operates as a two-engine business made up of consumer devices such as phones, TVs, and appliances, and semiconductors, especially memory chips. Today, the investment case is mainly driven by the semiconductor segment.
Demand for high performance memory is increasing due to AI, and early 2026 data shows strong rises in DRAM and NAND prices. When memory prices increase, Samsung’s profits tend to grow quickly.
Memory chips are largely a commodity, so performance depends heavily on how well supply matches demand. The key is avoiding overinvestment that leads to excess supply, which can quickly push prices down.
FY2025 confirmed a clear rebound with record quarterly revenue, strong operating profit, and a net cash balance of around KRW 100 trillion. This financial strength allows the company to keep investing through cycles and continue returning capital to shareholders.
At around KRW 200,000 per share, the stock looks roughly fairly valued, with potential upside if the current strength in memory lasts longer than usual.
The main risk is that memory is highly cyclical. If prices fall, earnings can decline quickly.
The investment case comes down to one key question. Does the current memory boom last longer than usual. If it does, there is meaningful upside. If it does not, the business is likely to move back into a downcycle.
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Cashflow_Queen is an employee of Simply Wall St, but has written this narrative in their capacity as an individual investor. Cashflow_Queen holds no position in KOSE:A005930. Simply Wall St has no position in any companies mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. This narrative is general in nature and explores scenarios and estimates created by the author. The narrative does not reflect the opinions of Simply Wall St, and the views expressed are the opinion of the author alone, acting on their own behalf. These scenarios are not indicative of the company's future performance and are exploratory in the ideas they cover. The fair value estimate's are estimations only, and does not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that the author's analysis may not factor in the latest price-sensitive company announcements or qualitative material.
