Goldman Sachs adds Samsung Electronics 2028 full-year forecast, keeps Buy rating and target price unchanged

Overview

This is a Goldman Sachs company research update on Samsung Electronics (005930.KS), with the core purpose of incorporating the 2028 full-year forecast into the earnings model. The main text clearly states that the newly added 2028E EPS is W23,915, while the investment thesis, rating, and target price remain unchanged.

Core views

Goldman Sachs remains constructive on Samsung Electronics and maintains Buy ratings on both the common and preferred shares. The 12-month target price for the common shares remains W205,000, and the preferred share target price remains W159,000. This report is not a major change in view, but rather an extension of the forecast horizon and continuation of the valuation framework.

Analysis framework

The report uses an SOTP valuation based on 2026E EV/EBITDA as the method for the common share target price, and derives the preferred share target price using a model based on the discount of preferred shares to common shares. The appendix also explains Goldman Sachs' Factor Profile, M&A Rank, and Quantum database research frameworks, which are used to interpret stock characteristics, acquisition probability, and sources of financial forecast data.

Methodology notes

• Valuation methodsEV/EBITDA SOTP

  Sum-of-the-parts valuation based on 2026E EV/EBITDA

  The common share 12-month target price of W205,000 is derived from an SOTP method based on 2026E EV/EBITDA, which is suitable for combining the earnings and valuation multiples of different business segments into the company’s overall value.

• Valuation methodsPreference share discount model

  Preferred share discount to common shares

  The preferred share 12-month target price of W159,000 is based on a 22% target discount of preferred shares to common shares, derived as the average of the two-factor model discount and the average discount of preferred shares to common shares over the past month.

• Factor frameworkGS Factor Profile

  Growth, financial return, valuation multiples, and composite factor percentile

  Goldman Sachs' Factor Profile measures a stock’s growth, financial return, valuation multiples, and composite attributes by comparing it with covered stocks and industry peers; the composite percentile is derived from growth, financial return, and inverse valuation multiples.

• M&A frameworkM&A Rank

  Acquisition target probability score

  Goldman Sachs uses an M&A Rank from 1 to 3 to assess the probability of a company becoming an acquisition target, with 1 representing high probability, 2 medium probability, and 3 low probability; this report mainly discloses the methodology and does not show Samsung Electronics' specific M&A score.

• Data toolQuantum

  Goldman Sachs proprietary financial database

  Quantum provides detailed historical financial statements, forecasts, and ratios, and can be used for deep analysis of a single company or cross-company comparison.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Samsung Electronics (005930.KS)

  Covered company common shares

  Strengths

  Maintains a Buy rating, with a W205,000 target price; the investment thesis remains unchanged after adding the 2028E EPS forecast.

  Weaknesses

  The main pressures disclosed in the report come from memory supply-demand, smartphone margins, and mobile OLED share.

  Comparison

  The rating is compared with peers in Goldman Sachs' coverage universe, including SK Hynix, LG Electronics, LG Display, Samsung Electro-Mechanics, and others.

  Risks

  Significant deterioration in memory supply-demand, sharp contraction in smartphone margins, and loss of mobile OLED market share.

• Samsung Electronics (Pref) (005935.KS)

  Covered company preferred shares

  Strengths

  Also maintains a Buy rating, with a W159,000 target price.

  Weaknesses

  The valuation depends on the assumption of a discount for preferred shares relative to common shares, and changes in that discount will affect the interpretation of the target price.

  Comparison

  The preferred share target price is based on a 22% target discount to the common shares rather than an independent re-rating of business value.

  Risks

  In addition to company fundamentals risks, investors should also monitor fluctuations in the preferred-to-common share discount.

Key data

• 2028E EPSW23,915The newly added full-year 2028 earnings-per-share forecast.
• Common stock target priceW205,00012-month target price, based on a 2026E EV/EBITDA SOTP valuation.
• Preferred stock target priceW159,00012-month target price, based on a 22% target discount to the common shares.
• Preferred stock target discount22%Derived from the average of the two-factor model discount and the average discount of preferred shares to common shares over the past month.
• RatingBuyBoth the common and preferred shares are rated Buy.

Impact & implications

The main significance of this report is that it extends the forecast horizon to 2028 rather than changing the investment recommendation. Keeping the Buy rating and target price unchanged means Goldman Sachs believes the added long-term forecast does not weaken the original investment thesis, but investors still need to closely monitor the memory cycle, smartphone margins, and the OLED competitive landscape.

Risks

• Significant deterioration in memory supply-demand.
• Sharp contraction in smartphone margins.
• Loss of mobile OLED market share.
• Goldman Sachs has disclosed investment banking and other client relationships with Samsung Electronics, so investors should read the disclosure of conflicts of interest in combination.

What to watch

• Whether the 2028E EPS forecast of W23,915 is achieved in line with the memory cycle and end-demand.
• Whether the supply-demand balance in memory shows a clear deterioration.
• Whether smartphone business margins contract rapidly.
• Changes in Samsung Electronics' share in the mobile OLED market.
• Whether the preferred stock discount to common shares moves close to or away from the 22% target discount assumption.