An AI-generated image depicts rising Samsung Electronics shares [CHATGPT]
Retail investors borrowed a record amount to buy Samsung Electronics shares as expectations for further stock gains intensified.
Margins linked to Samsung Electronics stood at 4.07 trillion won ($2.7 billion) as of Wednesday, according to Yonhap Infomax. This is the first time that the value of securities serving as collateral against loans tied to the stock has surpassed 4 trillion won.
The margin balance for Samsung Electronics shares rose for nine consecutive trading sessions from May 8 through Wednesday. During the period, the balance rose by 903.1 billion won.
The trend reflects a strong "fear of missing out" sentiment among retail investors.
Expectations of rising demand for memory semiconductors, driven by expanding AI investment, also fueled buying sentiment. Forecasts of improved earnings also helped.
A screen in Hana Bank's trading room in central Seoul shows Samsung Electronics shares closing at 299,500 won on May 20, up 8.51 percent from the previous trading session. [YONHAP]
Retail investors have net purchased 11.05 trillion won worth of Samsung shares so far this month as of Wednesday. But foreign investors net sold 14.73 trillion won worth of shares during the same period.
Although the shares experienced volatility after the company’s labor union announced plans for a general strike, retail investors viewed the drop as a buying opportunity.
Labor-management tensions sent shares of Samsung Electronics plunging during intraday trading on Wednesday. But retail investors alone net purchased 767 billion won worth of the company's shares that day.
Investor sentiment rebounded after Samsung management and the labor union unexpectedly reached a tentative wage agreement later that day.
Samsung Electronics' management negotiator Yeo Myung-koo, left, and Choi Seung-ho, head of the Samsung Electronics chapter for the Samsung Group United Union, shake hands after signing a tentative wage agreement for 2026 on May 20. [JOINT PRESS CORPS]
Samsung Electronics shares rose 8.51 percent to trade at 299,500 won on Thursday.
Easing labor-related risks could further strengthen the stock's upward momentum.
Shinhan Securities raised its target price for Samsung Electronics to 550,000 won, reflecting reduced uncertainty surrounding labor-management relations.
“The easing of labor risks has allowed Samsung Electronics to enter a phase of valuation normalization,” Kim Hyung-tae, an analyst at Shinhan Securities, told Yonhap News Agency. “Additional increases in memory prices, stable earnings prospects and stronger shareholder return policies are expected.”
Korea Investment & Securities also raised its target price to 570,000 won.
Members of Samsung Electronics' labor union stages a protest outside the company's building in Pyeongtaek, Gyeonggi, on April 23. [NEWS1]
“Concerns over strikes had previously limited Samsung Electronics’ stock gains compared to its competitors, and momentum could become even stronger now that the risks have eased,” Korea Investment & Securities analyst Chae Min-sook said.
Some analysts, however, warned about the possibility of a downturn in the semiconductor market next year.
“It will not be easy for big tech companies to continue to significantly increase capital expenditures next year,” Song Myung-sub, an analyst at iM Securities, said. “High profits enjoyed by memory chipmakers may become difficult to sustain over the long term.”
Song added that “a market correction could emerge after the second half of next year alongside falling memory prices.”
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
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