Samsung Electronics poised for valuation normalization amid profit growth and dividend expansion, says KB Securities

KB Securities forecasts that Samsung Electronics is poised to enter a sustained period of valuation normalization, driven by a combination of long-term profit growth and an enhanced shareholder return policy. The securities firm anticipates that structural memory supply shortages will align with robust profit increases and a strong commitment to dividends.

According to KB Securities' analysis, Samsung Electronics' future earnings visibility has significantly improved. The firm projects that the company's operating profit will reach 33 trillion won in 2024, a notable increase from the previous year. Looking ahead, the forecast suggests a further surge to 57.5 trillion won in 2025, indicating a strong upward trajectory for profitability.

This optimistic outlook is underpinned by the expectation of continued structural shortages in the memory market, which typically benefits semiconductor manufacturers like Samsung. Coupled with these market conditions, Samsung's proactive shareholder return policies are expected to further bolster investor confidence and contribute to the company's valuation.