Conflicting target price revisions:
KB Securities: ₩120,000 → ₩130,000 (HBM3E ramp-up).
iM Securities: ₩101,000 → ₩97,000 (HBM oversupply risk).
HBM Market Conditions:
Projected 2024 demand: 880M GB
Planned supply: 1.38B GB (potential oversupply).
Big Tech CAPEX increasing:
Meta’s guidance raised to $37B.
Microsoft & Amazon also expanding investments.
Legacy DRAM faces 23% undersupply in 2024.
Opinion
The split in outlooks reflects a clash between short-term and long-term views.
HBM oversupply risks exist, but legacy DRAM shortages could create upside catalysts.
Big Tech CAPEX expansion supports continued AI demand, countering AI investment bubble fears.
However, Samsung’s lagging HBM3E adoption remains a key long-term concern.
Core Sell Point
While short-term factors (legacy DRAM shortages, AI CAPEX) may support a rebound, Samsung’s structural weakness in HBM presents a longer-term competitive risk. The market may reward near-term positives, but Samsung must prove it can close the HBM gap for sustainable growth.
Analysts remain deeply divided on Samsung Electronics, with some raising target prices to ₩130,000, while others cut them below ₩100,000.
The key debate centers around Samsung’s position in the high-bandwidth memory (HBM) market. While some see a turnaround with HBM3E mass production, others fear oversupply risks.
For now, the market leans bullish, citing rising CAPEX guidance from Big Tech companies as a key tailwind for AI infrastructure investments.
Brokerage Target Price Revisions
Bullish: KB Securities (₩120,000 → ₩130,000)
Justification: HBM3E supply ramp-up.
Kim Dong-won (Head of Research, KB Securities):
"Samsung is entering a phase where concerns are rapidly turning into optimism."
"With HBM3E mass production expected in Q4, we see Samsung as the top KOSPI pick for H2."
Samsung lags SK Hynix in HBM3E adoption:
SK Hynix began HBM3E 8-layer supply to NVIDIA in March and will start HBM3E 12-layer shipments in Q4.
Samsung is still undergoing NVIDIA’s quality testing and plans Q3 mass production for HBM3E 8-layer, with HBM3E 12-layer shipments later this year.
Bearish: iM Securities (formerly Hi Investment & Securities) (₩101,000 → ₩97,000)
Concerns:
HBM oversupply risk in 2025.
Samsung’s HBM3E supply ramp-up may intensify competition, leading to pricing pressure.
AI investment bubble concerns.
Song Myung-seop (iM Securities):
"This year, HBM demand is expected to reach 880 million GB, but production plans total 1.38 billion GB."
"If NVIDIA begins purchasing Samsung’s HBM3E, we could see oversupply and margin compression in the HBM sector."
Additionally, NVIDIA’s Blackwell AI accelerator delay could further impact Samsung’s HBM3E adoption.
The Information (U.S. tech media):
Blackwell production was postponed from late 2024 to Q1 2025.
Since HBM3E is a core component of Blackwell, delays could push back Samsung’s shipments.
However, KB Securities argues this could work in Samsung’s favor, allowing it more time for mass production preparation.
Big Tech CAPEX: The AI Investment Cycle Continues
Despite AI bubble concerns, Big Tech companies continue to raise AI-related infrastructure spending.
Meta increased 2024 CAPEX guidance from $35B → $37B.
H1 CAPEX: $15.2B
H2 projected CAPEX:$21.8B
Microsoft and Amazon have also signaled higher H2 spending.
Shin Ji-hyun (Shinhan Investment & Securities):
"Meta’s CAPEX revision reaffirms strong confidence in AI investment."
If quarter-over-quarter CAPEX increases, this could fuel further AI value chain growth, benefiting Samsung’s AI-related semiconductor sales.
Legacy DRAM & NAND: Supply Shortages Emerging?
While HBM faces supply concerns, legacy DRAM and NAND markets are tightening.
Morgan Stanley:
"The shift toward HBM has created investment gaps in traditional DRAM, leading to potential shortages."
Predicts a 23% demand-supply gap in DRAM for 2024, driving price increases.
DRAM Pricing:
PC DRAM (DDR4 8Gb 1Gx8): $2.10 (as of July 31, stable for 3 months).
Shinhan Investment:
"Stronger-than-expected memory price growth could offset some of the bearish pressures on Samsung’s stock."
Samsung plans to mass-produce QLC-based 64TB and 128TB eSSD products in H2 2024, aiming to capitalize on NAND pricing recovery.
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