What will happen to Samsung Electronics' stock price?

Dynamics and Investment Methodology of Samsung Electronics' Stock Price

In the Korean market, Samsung Electronics is one of the few stocks with simple dynamics, and it can earn high profits if it follows easy investment principles.

The trend and cycle of Samsung Electronics' stock prices are very clear when drawing them on a log scale.


After the 2008 financial crisis, Samsung Electronics' long-term rise began as the leading industry of the global economy shifted from the traditional manufacturing industry to the IT industry. However, there are currents and waves in every stock price flow. In addition to the long-term upward trend centered on the upward trend, there were cycles that fluctuated between the bottom and top of the channel according to the global macro environment and the short-term cycle of the IT industry in the 4-5 year cycle. After rising from the bottom to the top of the channel over two to three years, it was repeated to fall to the bottom over a similar period.


Samsung Electronics Stock Price = IT Industry High Growth Trend + Global Macro Environment and IT Industry Cycle


Thanks to the stable upward trend and the nature of stock prices in which cycles coexist, Samsung Electronics has been one of the easiest stocks to invest in in the past decade. People who make good money from stocks like Samsung Electronics do not listen to what the media and securities firms reports say or what people around them bark. They are those who know how to sell at the top of the channel when stock prices reach the bottom of the channel and buy them after buying them when the market and the media call for crisis theory, and enjoy the upward trend for two to three years.


But a lot of people buy stock prices at the top of the channel when good news hits their ears

At the bottom of the channel, stock prices are sold when bad news (already long overdue) flows into his ears.


■ What will happen to Samsung Electronics' stock price?

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It is unlikely that the long-term growth of the IT and semiconductor industries will end at present. Therefore, the long-term trend marked with orange lines is likely to be alive.

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Samjeon shares, which touched the top with an overshoot in January 21, are in the midst of a downward trend that falls to the bottom of the channel.

There may be technical fluctuations in the middle, but in the near future, it is expected to give a great chance to touch the bottom of the channel and buy it at a low price. I think around 60,000 won will be the point of purchase. The sooner we reach the bottom, the closer the bottom will be, and on the contrary, if the stock price continues to hold out as it did in 2013-2015, the timing of the purchase will be pushed back if the technical fluctuation is prolonged.

After touching the bottom of the channel, it is expected that semiconductor supercycles will return to a long-term upward trend around 2024 due to the replacement of DDR5 memory generations.


The figure below is just an example, and swingers who try to eat small waves on a short clock below the monthly salary unit are excluded.

1. Wait for an accident at the bottom of the channel.

2. Wait until you reach the top of the channel and sell it.

3. I bought it at the bottom of the channel, but if it breaks at the bottom, I will cut it off. (This is because the long-term upward trend may be breaking.)

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■ What is the possibility that Samsung Electronics will end its long-term trend?


Although the possibility of Samsung Electronics damaging its long-term fundamentals seems low at present, it is one of the scenarios that needs to be prepared.

Samsung is still the dominant player in memory. Although the gap between the foundry and TSMC is widening, it is still second in the industry, and in the case of various unfavorable factors such as Samsung's current foundry yield issue, excessive pessimism should be wary as it is always an issue in the early stages of process development.

However, if the slope of the long-term trend line becomes gentle, buying and selling RBIs change.


LG Household & Health Care, which was considered a representative player in long-term idol-oriented stocks, recently ended its long-term trend as the bottom of the channel was broken.

This is because the long-term competitiveness of raw cosmetics has been seriously damaged as the quality of China's own brands has rapidly risen in the Chinese cosmetics market. No matter how blue-chip stocks are, the trend can change due to changes in the long-term environment of the industry (cycle, competition structure), or internal problems of the company fester.

The leading industry in the 2000s was the chimney industry such as the shipbuilding industry. However, in the 2010s, thanks to the spread of smartphones, there is a history of changing the IT industry-leading sector, led by FAANG in the U.S. In the 2020s, there is a possibility that the leading sector will change to eco-friendly/electric vehicles, and trends in the electric/electronic industry will be sluggish unlike in the 2010s. This is why it is necessary to set the principle of rejection in advance if the bottom is broken and consider selling with the possibility of changing the position of the top in mind.


In the early 2010s, Samsung Electronics showed better performance than TSMC thanks to smartphone specialties. However, since 2020, TSMC has made astronomical foundry investments, overwhelmingly beating Samsung in terms of production capacity, yield, and technology, and major foundry customers have turned to TSMC from Samsung Electronics. Since then, the stock prices of the two companies have fluctuated for a short time, but the TSMC has risen much lighter and better, worsening decoupling.

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When Samsung used to use TSMC as a special smartphone -> When TSMC trampled on Samsung with its foundry technology


Intel, which once dominated the semiconductor market, once neglected key engineers and pushed for wrong policies, but the long-term upward trend was broken, so it would be good to refer to it.