Key Takeaways
- Shawn Kim from Morgan Stanley identified Samsung’s steep decline as an attractive entry point, with shares falling approximately 20% over five trading days
- Samsung’s performance lagged behind the broader KOSPI index, which declined 17% during the identical timeframe
- The investment bank maintained Samsung as its preferred stock selection, highlighting HBM4 progress, SRAM technology, and manufacturing adaptability
- According to Korea JoongAng Daily, the company’s $37 billion Texas semiconductor facility won’t reach full production until early 2027
- Samsung shares in Seoul plummeted almost 12% during Wednesday trading, following a 10% decline in the prior session
Samsung Electronics experienced significant turbulence this week. Shares declined approximately 20% over five days, performing worse than the KOSPI index’s 17% retreat.
The most recent setback originated from a Korea JoongAng Daily article released on Tuesday. The publication reported that full-scale manufacturing at Samsung’s Taylor, Texas site has been delayed once more — now targeting early 2027.
The facility, valued at $37 billion, was originally unveiled in 2021. Since its announcement, the project has encountered numerous scheduling setbacks, even after securing substantial chip contracts.
Among these agreements is a purported $16.5 billion arrangement with Tesla. However, even this significant deal hasn’t prevented the project from experiencing continued postponements.
The article referenced several unnamed sources with knowledge of the situation. While pilot operations have commenced, no definitive production launch date has been established.
Samsung disputed the characterization. Company representatives informed the publication that “production” refers to finalizing mass manufacturing preparations by late 2026, with operational readiness achieved by that deadline.
Previous projections had indicated second-generation 2-nanometer chips, designated SF2P, would begin mass production in 2025. That schedule now appears to have been delayed.
Seoul-traded Samsung shares dropped nearly 12% to 172,100 won during early Wednesday trading. The stock had previously declined 10% in the preceding session.
Investment Bank Recommends Purchase
Amid this challenging environment, Morgan Stanley analyst Shawn Kim offered a contrasting perspective. He characterized the downturn as an advantageous moment for investors.
“Past corrections of this magnitude have typically presented attractive buying windows,” Kim noted, emphasizing that profit forecasts retain “substantial upside potential.”
The financial institution maintained Samsung as its preferred investment choice. It also reaffirmed its favorable stance on SK hynix.
Morgan Stanley highlighted HBM4 certification progress, SRAM technical capabilities, and manufacturing versatility as justifications for remaining positive about the shares.
Kim additionally described an evolution in AI memory design. He indicated the industry is transitioning toward a hybrid approach as processors become increasingly specialized.
Evolution in AI Memory Design
While HBM continues to dominate, Morgan Stanley noted that SRAM is becoming increasingly important for applications where response time outweighs bandwidth.
The investment bank anticipates Nvidia will introduce a new inference processor at its forthcoming GPU Technology Conference. The processor would employ a Language Processing Unit design incorporating substantial on-chip SRAM.
Morgan Stanley characterized the design as “specifically engineered for inference’s sequential processing requirements.” The firm stated the processor targets customers prioritizing performance.
Kim presented this as a synergistic relationship rather than direct rivalry. The perspective suggests SRAM manages time-critical operations while HBM provides expandable memory resources.
The firm also observed that LPU architectures might circumvent existing supply constraints affecting HBM and CoWoS packaging technologies.
Samsung shares were changing hands at 172,100 won during Wednesday morning trading, declining almost 12% for the day.
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