In mid-July, investor sentiment surrounding Samsung Electronics is divided into two extremes. The second-quarter earnings announcement was surprising; despite achieving a record-breaking operating profit of 89.4 trillion won, the stock price has actually fallen significantly from its previous high.
This discrepancy is confusing many people. This is because reality does not match the expectation that "with such good performance, shouldn't the stock price rise?" However, in the stock market, good performance and good stock prices do not always move together.
Just how amazing were the Q2 earnings?
Samsung Electronics' operating profit for the second quarter was 89.4 trillion won.This figure exceeded the market consensus of the high 80 trillion won range by approximately 51 TP3T. Revenue also rose to 171 trillion won, up 1,291 TP3T from the same period last year, and the operating profit margin reached approximately 521 TP3T.
On top of that, with performance bonuses of approximately 17 trillion won scheduled, this means that profits will ultimately far exceed 100 trillion won. Looking at the numbers alone, it is indeed a remarkable achievement. This is the result of the deepening semiconductor boom driven by the combined effects of increased demand for AI data centers and a shortage of memory chips.
| Evaluation Perspective | favorable factors | Negative factors |
|---|---|---|
| In terms of performance | Achieved record-breaking operating profit | already expected figures |
| industrial demand | Continued investment in AI data centers | Peak-out signal interpretation |
| Supply and demand aspects | Institutional and Foreign Interest | Profit taking and exchange rate deterioration |
So why did the stock price fall?
Herein lies a key phenomenon. Even after announcing record-breaking earnings, the stock price actually plummeted. Over the past 10 days, the stock price has dropped by approximately 181 TP3T. It has fallen to roughly the 270,000 to 300,000 won range.
There are two main reasons why this happens, and one is Expectations are already reflected in the stock price.The point is that it had already happened. Many investors had anticipated "record-breaking earnings" in advance, and that expectation had already been reflected in the stock price.
The other one is Profit taking by leverage investorsShort-term supply and demand deteriorated rapidly as investors who had entered through ETFs and margin trading quickly sold off their holdings immediately after positive news emerged. The stock price was shaken by issues purely related to trading, unrelated to the company's fundamentals.
What does it mean that the market has already reflected it all?
Stock prices predict the future.That is the basic principle of the market. If investors think, “Samsung Electronics will make a lot of money in the future,” that expectation is reflected in the current stock price.
The problem is that when actual earnings are released after expectations have already been reflected in the price, there is little room for further gains. In fact, if the perception is, "Ah, it didn't quite live up to expectations," the stock price could actually fall. This phenomenon “Event Sell-on”It is called [this].
Stock prices do not rise simply because good news comes out; they only rise when the news exceeds expectations.
Will the AI supercycle really continue?
On the other hand, there are also structurally positive signals. With the emergence of agent AI, data requirements have increased explosively.They are doing so. Global big tech companies, led by Nvidia, are continuing their investment in AI data centers.
Demand for HBM and high-capacity NAND remains tight. In other words, while the short-term boom may have ended, it means that semiconductor demand itself will continue to grow in the mid-to-long term. It appears unlikely that the cycle of market crashes caused by oversupply, as seen in the past, will repeat itself.
Would there be a problem if I entered now?
This is the dilemma faced by investors looking to enter at the current price. No matter how good a company is, buying it at a high price can result in a bad investment for individual investors.
Moreover, macroeconomic risks such as entrenched exchange rates, foreign capital outflows, and global economic instability are compounding. No matter how strong Samsung Electronics' earnings are, the structure is such that if overall market sentiment deteriorates, the stock is bound to fall in tandem.
Furthermore, no one knows when the bottom will be reached. Even brokerage analysts are suggesting that it is "not the bottom yet." Rather than going all-in at once, it is a wise approach to manage your average purchase price through staggered buying.
Ultimately, corporate growth and return on investment are separate issues.
Samsung Electronics is clearly a structurally strong company. Factors such as increasing demand for AI, memory supply shortages, and the expansion of high-value-added products are all favorable to Samsung Electronics. This means that the company's future growth prospects cannot possibly be bad.
However, a good company may not necessarily be a good stock. When you buy it, and how much you pay for itBecause that is the most important factor determining investment returns. Amid the market crash in mid-July, it seems that many investors are feeling that difference once again.