With the domestic stock market undergoing adjustments for more than a month recently, centered on se..
Taking a breath of semiconductor 株 on earnings perception
The outlook for the stock market is also mixed over future business conditions
![Amid the continued adjustment of semiconductor stocks, large-scale shareholder return measures by Samsung Electronics and SK Hynix are emerging as key variables in future stock prices. [Yonhap News]](https://wimg.mk.co.kr/news/cms/202608/15/news-p.v1.20260814.e695683065f545eaa42545016206376f_P1.jpg)
With the domestic stock market undergoing adjustments for more than a month recently, centered on semiconductor stocks, the market’s attention is on measures to return shareholders of Samsung Electronics and SK Hynix, two-top semiconductors. As the two companies’ operating profits are approaching hundreds of trillion won in the first half of the year alone due to the booming artificial intelligence (AI) memory, stock prices are expected to be affected in the future depending on how much they return to shareholders. In particular, global rival Sandisk recently said it plans to return all of its remaining surplus cash to shareholders “after investing in the business.” Then, on the 13th (local time), SanDisk’s stock price soared 13.7%.
According to related industries on the 15th, Samsung Electronics and SK Hynix’s operating profit in the first half of the year was 146 trillion won and 98 trillion won, respectively, up eight times from the same period last year.
The “all-time” performance of these companies has already been substantially reflected in their stock prices. Now, the market is paying attention to how much it will be divided. Samsung Electronics and SK Hynix are following the policy of using 50% of their accumulated free cash flow (FCF) as a source of shareholder return over the past three years.
Based on this, Samsung Electronics has been regularly distributing about 9.8 trillion won annually. In particular, it also had a special dividend last year.
![Samsung Electronics in Seocho-gu, Seoul. [Yonhap News]](https://wimg.mk.co.kr/news/cms/202608/15/news-p.v1.20260814.a0785cf664f8457fba4ead882b0dc7a9_P2.jpg)
In a conference call to announce its earnings on the 30th of last month, Samsung Electronics said it is discussing implementation measures including special dividends this year and the next shareholder return policy from various angles. As early as this month, it will unveil its next three-year shareholder return policy, including special dividends.
KB Securities estimated in a recent report that “the annual size of Samsung Electronics’ new shareholder return policy, which will be announced soon, will be more than 10 times larger than the previous (9.8 trillion won).” It is estimated that the total shareholder return will reach at least 600 trillion won to 700 trillion won over the next three years, and the dividend yield based on cash dividends will reach 7-15%.
DS Investment & Securities expects Samsung Electronics to return an additional 131.8 trillion won, which deducts the total amount of regular dividends, from 161.3 trillion won, which is 50% of the accumulated FCF for three years (2024-2026). It also predicts that up to 40% of them can be used for special dividends and the rest can be used for treasury stock purchases and incineration.
SK Hynix also allocated about 2 trillion won last year. Earlier this year, it incinerated 12 trillion won worth of treasury stocks as part of its shareholder return. It will announce additional shareholder return plans during the third quarter.
In particular, SK Hynix is mentioned for the possibility of up to 100 trillion won worth of treasury stock purchases, incineration, and special dividends based on abundant financial resources such as the inflow of payments for the sale of its stake in Kioxia in Japan.
![SK Hynix. [Yonhap News]](https://wimg.mk.co.kr/news/cms/202608/15/news-p.v1.20260814.6fecffba97be41e495e4693ca48af23f_P2.jpg)
Kim Young-gun, a researcher at Mirae Asset Securities, said, “SK Hynix’s special shareholder return will reach around 40 trillion won. The larger the return, the more confident it will be interpreted as a cash generation ability in the future, and the dividend yield of up to 3.9% based on the current stock price is expected.”
Daishin Securities believes that the net cash goal of 100 trillion won proposed at the general shareholders’ meeting at the beginning of the year may have already been achieved by the inflow of funds issued by the U.S. Stock Deposit Certificate (ADR), so shareholders can return up to 100 trillion won by combining treasury stock purchases, incineration, and special dividends.
Recently, the stock market seems to be lowering the target stock price of Samsung Electronics and SK Hynix.
Kiwoom Securities lowered Samsung Electronics’ target price from 390,000 won to 350,000 won, saying that the memory peak could come sooner than expected. Mirae Asset Securities lowered its target price from 550,000 won to 370,000 won, Shinhan Investment & Securities from 590,000 won to 450,000 won, and Samsung Securities from 500,000 won to 400,000 won. On the other hand, KB Securities maintained 600,000 won, saying that the supply shortage continues for at least three years.
There is also a big difference in perspective surrounding SK Hynix. Mirae Asset Securities lowered its target stock price from 4.2 million won to 2.8 million won on the 29th of last month. Shinhan Investment & Securities also lowered it from 4.2 million won to 2.7 million won, NH Investment & Securities lowered it from 4.1 million won to 3.4 million won, Daishin Securities lowered it from 3.9 million won to 3.2 million won, and Samsung Securities lowered it from 3.5 million won to 3 million won, respectively. On the other hand, Korea Investment & Securities raised its target price of SK hynix to 4.7 million won from 3.8 million won. As a result, the target stock price of each securities company increased by 2 million won from 2.7 million won to 4.7 million won.
