Goldman Sachs Sticks with Buy Rating on Samsung, SK Hynix Amid Share Price Declines

Goldman Sachs has maintained its buy rating on Samsung Electronics and SK Hynix after recent share price declines. The investment bank attributed the decline to concerns over weakening memory pricing expectations, lack of long-term agreement details, higher inventory at module makers, increasing China supply, absence of shareholder return announcements, and SK Hynix's second quarter operating profit miss.

The shares of Samsung Electronics and SK Hynix fell 23% and 35% respectively over the past month. Goldman Sachs noted that current valuations suggest the market does not believe in the sustainability of solid earnings for these companies.

According to Goldman Sachs, Samsung Electronics trades at 3.6 times its 2027 price-to-earnings ratio and 1.4 times its price-to-book ratio. SK Hynix trades at 3.5 times its price-to-earnings ratio and 1.6 times its price-to-book ratio.