Key Takeaways
- Morgan Stanley’s Shawn Kim identified Samsung’s recent decline as a strategic entry point, with shares falling approximately 20% over the week
- Samsung’s performance lagged the KOSPI index, which declined 17% during the same timeframe
- The investment bank maintained Samsung as its preferred investment, highlighting HBM4 progress, SRAM technology, and foundry adaptability
- According to Korea JoongAng Daily, Samsung’s $37 billion Texas semiconductor facility won’t reach full production until early 2027
- Wednesday trading saw Samsung’s Seoul-listed shares plummet nearly 12%, following a 10% decline in the prior session
Samsung Electronics faces significant market turbulence. Shares have declined approximately 20% over the past week, performing worse than the KOSPI index’s 17% retreat.
The latest catalyst emerged from a Korea JoongAng Daily article released Tuesday. The publication reported that Samsung’s Taylor, Texas manufacturing facility faces another delay — with full-scale production now expected in early 2027.
The facility, representing a $37 billion investment, was initially unveiled in 2021. Since its announcement, the project has experienced numerous schedule adjustments, even after securing significant chip manufacturing agreements.
Among these agreements is an alleged $16.5 billion arrangement with Tesla. However, this substantial contract hasn’t prevented ongoing postponements.
The publication referenced several informed sources. While pilot operations have commenced, a definitive timeline for full production remains unclear.
Samsung disputed the characterization. Company representatives clarified to the publication that “production” means finalizing mass manufacturing preparations by late 2026, with operational readiness achieved by that date.
Previous projections indicated second-generation 2-nanometer chips, designated SF2P, would enter mass production during the current year. That schedule now appears postponed.
Seoul-traded Samsung shares declined nearly 12% to 172,100 won by Wednesday morning. The stock had previously dropped 10% during the preceding trading day.
Investment Bank Identifies Opportunity
Amid this downturn, Morgan Stanley’s Shawn Kim offered a contrarian perspective. He characterized the market correction as presenting an attractive entry opportunity.
“Historically, such corrections have offered a good opportunity to buy,” Kim noted, emphasizing that earnings projections retain “a lot of room for recovery.”
The investment bank continued designating Samsung as its premier selection. It simultaneously maintained a favorable outlook on SK hynix.
Morgan Stanley highlighted HBM4 qualification progress, SRAM technology capabilities, and foundry operational flexibility as justifications for maintaining confidence in the stock.
Kim additionally described an evolving trend in AI memory design. He indicated the industry is transitioning toward hybrid architectures as semiconductors become increasingly specialized.
Evolving AI Memory Design
While HBM technology maintains market leadership, Morgan Stanley noted SRAM is becoming more prominent for applications prioritizing latency over bandwidth.
The firm anticipates Nvidia will introduce a new inference processor at its forthcoming GPU Technology Conference. The processor would employ a Language Processing Unit design centered on substantial on-chip SRAM capacity.
Morgan Stanley characterized the design as “purpose-built for the sequential speed of inference.” The firm stated the processor targets clients prepared to invest for performance advantages.
Kim positioned this as a synergistic relationship rather than direct rivalry. The perspective suggests SRAM manages time-critical operations while HBM provides expandable memory resources.
The investment bank also observed LPU architectures could circumvent existing supply constraints affecting HBM and CoWoS packaging technologies.
Samsung shares traded at 172,100 won Wednesday morning, reflecting a nearly 12% session decline.
