[Market Focus] Samsung Electro-Mechanics Rallies on Strong Q4 Earnings Outlook

Samsung Electro-Mechanics is continuing its strong upward trend for the second consecutive day.

As of 9:29 a.m. on November 25, Samsung Electro-Mechanics was trading at 238,000 won on the Korea Exchange, up 12,000 won (5.31%) from the previous day. Following a 3.9% increase the previous day, the stock is maintaining a rise of over 5% today as well.

Expectations for strong fourth-quarter earnings appear to be driving the share price higher. On this day, DB Financial Investment forecast that Samsung Electro-Mechanics’ fourth-quarter operating profit will reach 23.1 billion won, up 100.8% year-on-year, surpassing the consensus estimate of 21.86 billion won. Jo Hyunji, a researcher at DB Financial Investment, commented, “Expectations for artificial intelligence (AI) are being reflected in the numbers,” adding, “Both the components and package solutions divisions are seeing a sharp increase in server sales, which will sustain the earnings momentum.”

Kyobo Securities also raised its fourth-quarter earnings estimate for Samsung Electro-Mechanics. Choi Boyoung, a researcher at Kyobo Securities, stated, “We have revised our previous operating profit estimate from 21.35 billion won to 23.07 billion won. This is due to effective cost control, despite recent positive currency effects and seasonal factors such as year-end inventory adjustments,” adding, “The company is expected to deliver peak-season-level results even during the off-season.”

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