Samsung, SK hynix sell-off excessive as memory outlook stays strong: analysts
The recent steep sell-off in Samsung Electronics and SK hynix shares has been excessive, driven by a lack of buying support in the Korean market and weaker investor confidence rather than deteriorating earnings, market watchers said Friday. Shares of the two semiconductor giants have fallen sharply this month amid a broader rout in the benchmark KOSPI, despite rising earnings forecasts fueled by…
Analysts argue that the recent significant sell-off in shares of Samsung Electronics and SK hynix is unwarranted and excessive. The decline in the value of these semiconductor giants has been largely driven by a lack of buying interest in the Korean market and reduced investor confidence, rather than a deterioration in their actual earnings.
Over the past week, Samsung Electronics and SK hynix shares have plummeted by 23.9% and 31.5%, respectively. This seven-day drop has been the sharpest in their history, while the broader KOSPI index has fallen by 21%. However, the market appears to be showing signs of recovery, with Samsung up 3.33% and SK hynix up 1.11% on Friday, as the KOSPI rebounded by 2.05% from a seven-day losing streak.
The analysts argue that the gap between the shares' prices and the companies' fundamental performance has pushed the valuation of these chipmakers to relatively low levels. Despite strong forecasts for artificial intelligence-driven demand and a tightening supply of memory, the recent sharp declines in Samsung Electronics and SK hynix appear to be an overreaction to the current market conditions.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
