It's Not Performance, It's Supply and Demand! Why You Should Buy Samsung Electronics on Every Dip | Cha Young-joo, Director, Wise Economic Research Institute

Summary

Director Cha Young-joo reviews the recent market turbulence, argues that stabilization is underway after single-stock leverage ETFs and hedge fund de-leveraging, and presents a detailed fundamental case for Samsung Electronics. He highlights Palantir’s strong AI monetization, favors Korean shipbuilding and transformer sectors for their order-to-earnings virtuous cycle, and cautions on Daewoo E&C.

• Korean markets have likely bottomed as extreme volatility from leverage ETFs and hedge fund de-leveraging subsides.
• Samsung Electronics sports a P/E of only 4x, ROE above 50%, strong cash generation, declining debt, and no inventory buildup, making it a buy on dips.
• Palantir’s outstanding earnings prove that AI application-layer companies can generate real profits.
• Korean shipbuilders now enjoy confirmed profits from prior low-price orders while new order backlogs continue to grow.
• Transformer companies such as Hyosung Heavy Industries are converting their 10-trillion-won-plus order backlogs into earnings with more orders piling up.
• Daewoo E&C lacks a similar virtuous cycle and has seen its target price lowered, making it less attractive.
• Potential easing of Middle East tensions could lower oil prices and help the rate outlook.