Samsung Electronics paces toward $1 trillion valuation on AI memory boom

Investing.com -- Samsung Electronics rose 3.63% on Tuesday in South Korea. Analysts say surging memory prices and sustained AI demand could push the chipmaker’s market value toward $1 trillion.

Morgan Stanley said Samsung’s path toward a trillion-dollar valuation would be driven by stronger earnings power, margin expansion and durable pricing strength in memory.

“Samsung's trillion-dollar era is driven by fundamentals, not just animal spirit,” said Morgan Stanley analyst.

South Korea’s benchmark KOSPI also closed up 2.11% at a record 5,969.64. Memory peer SK Hynix climbed 5.68%. Stock has gained 179% in last six months.

Morgan Stanley raised its price target to 248000 won from 210000 won and said a model based on 13% sustainable return on equity, 11% long-term revenue growth and 35% operating margins over cycles is achievable in an AI-driven environment.

Macquarie set a 340000 won target, implying about 80% upside, and said memory has become a chokepoint in the AI inference era.

Physical capacity constraints and long lead times for new fabs are reinforcing suppliers’ pricing power, as customers prioritize securing memory for AI infrastructure.

The firm expects DRAM and NAND prices to remain strong for at least two more years, forecasting net profit to rise tenfold between 2025 and 2028, with memory accounting for all profit growth over that period.

“Samsung Electronics is best positioned to capture this multi-year strong memory upcycle. Its product mix is geared to commodity memory, especially legacy and low-density chip,” Macquarie analysts said. “Moreover, only SEC is able to commission new fabs seamlessly in the next 3 years, P4 now and P5 from 2028.”

Citi raised its target to 280000 won from 240000 won, projecting 2026 global DRAM and NAND average selling prices to rise 171% and 127% year over year, respectively. It now expects Samsung’s 2026 operating profit to reach 251 trillion won, up sharply from prior estimates, on tight supply and strong AI server demand.

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