Sector Rotation While Samsung Electronics and Hyundai Motor Rest

Recently, Samsung Electronics' stock price showed a slight decline due to selling pressure from foreign investors. In contrast, SK Hynix saw an inflow of foreign buying, showing an upward trend of over 3%. This divergence between the two major semiconductor stocks is analyzed to be due to short-term differences in supply and demand.

Currently, Samsung Electronics and SK Hynix are facing different supply and demand situations overall, which directly impacts the stock price movements of each company.

Astra's plan to use 400,000 NVIDIA GPUs is raising expectations for SK Hynix's HBM (High Bandwidth Memory) supply cooperation.

Furthermore, SK Hynix's share buybacks are also having a positive impact on its stock price. These buybacks provide a supply and demand defense effect in the market, alleviating downward pressure on the stock price.

Recently, large-cap stocks like Samsung Electronics and Hyundai Motor have lost momentum and are showing weak performance. Meanwhile, a clear sector rotation phenomenon is observed, with market interest shifting to individual stocks or specific sectors that had been previously overlooked.

This change can be confirmed by the strong price surges seen in certain stock groups like DB Hitek and Gaon Cable. Some stocks have recorded very significant gains, attracting investors' attention.

DB Hitek recently surged from 87,000 won to 112,000 won in a short period, leading positive market momentum. This clearly demonstrates a shift in market leadership.

Gaon Cable also gained attention as a strong chart stock and a report-related stock, showing an upward trend. Doosan Fuel Cell also continued its strength in fuel cell related areas. The movements of these stocks suggest that the nature of the market has changed from the past.

Therefore, investors should accept this change in market dynamics and reconsider their investment strategies to align with the new trends.

This confirms the market's positive assessment and strong trend for the semiconductor industry as a whole.

Similar to what was seen in the secondary battery cycle of 2013, a sector rotation structure where one stock rises and other related stocks follow suit is now observed in the semiconductor industry.

Increased interest in power semiconductors following news of Qualcomm and Amazon's collaboration also had a positive impact.

Furthermore, the effect of successive foundry price increases in March, June, and September is being reflected in its performance, strengthening its earnings momentum.

Amidst market sector rotation, power infrastructure related stocks, which had been relatively overlooked, are gaining attention. Doosan Fuel Cell and Taihan Electric Wire are prime examples, showing upward trends and attracting investor interest.

This reflects expectations that AI momentum will continue, leading to increased demand for related infrastructure investment, and overall benefits for AI-related industries are anticipated.

Within the secondary battery sector, differentiated trends are emerging among individual stocks. Samsung SDI is in a wait-and-see situation regarding breaking its previous high, requiring verification of additional upward momentum.

On the other hand, SK Innovation is showing a relatively solid performance in the market, maintaining a steady trend. This indicates that investor sentiment for specific stocks is operating differently.

This target price increase is based on expectations of improved earnings for DB Hitek.

With continuous foundry price increases and full-capacity operation, DB Hitek's operating profit margin is estimated to reach 30%. This supports the outlook that the company's profitability will significantly improve.

The semiconductor market 'bubble theory' has proven to be an argument that overlooks the reality of the current industry. In particular, the fact that Samsung Electronics' inventory level is only one week's worth clearly demonstrates the industry-wide inventory shortage.

Such a low inventory level means that the situation is tight even for actively responding to demand. Therefore, it can be confirmed that the upward trend in the semiconductor market is not a mere bubble but is caused by actual supply and demand imbalances.

However, despite this negative factor, the average selling price (ASP) forecast for DRAM was raised by 4.8%, creating an offsetting effect.

In other words, the analysis is that sales can be protected through price (P) increases while quantity (Q) remains constant. Accordingly, the existing forecast that Samsung Electronics' operating profit will reach around 500 trillion won in 2025 has been maintained.

A target price is merely a benchmark containing an analyst's opinion, not a fixed figure. It is natural for securities firms to have different target prices, and this is not a matter of right or wrong but rather presents various perspectives.

The target price serves as a benchmark that helps investors decide what kind of investments to make. It has the positive function of facilitating investment when high and encouraging caution when low.

This is due to an upward adjustment of the DRAM average selling price (ASP) forecasts for 2026 and 2027 by 4.4% and 1.2% respectively.

Currently, SK Hynix is trading at 3.1 times its estimated earnings per share (EPS) for 2027 and 1.6 times its book value per share (BPS), indicating an absolutely low valuation level.

Selling volume from individual investors who entered during the previous upswing is acting as overhead resistance.

Individual investors hoping to recover their principal are offloading shares in this range, and foreign investors are consistently absorbing this volume.

This supply and demand situation indicates that SK Hynix's stock price needs to absorb individual selling pressure to achieve further gains.