Samsung Falls Amid Quarterly Profit Concern: Seoul Mover
Samsung Electronics Co. (005930), the world’s biggest maker of computer memory chips and flat screens, fell to a four-month low in Seoul trading amid speculation second- quarter earnings may miss some analysts’ estimates.
The stock, which makes up 16 percent of the benchmark Kospi index making it the biggest in terms of weighting, slumped 4.2 percent to 1.132 million won at the close of trading on the Korea Exchange, the lowest since Feb. 14. The Kospi retreated 1.2 percent.
Taurus Investment & Securities Co. today reduced its estimate for the company’s second-quarter operating profit to 6.9 trillion won ($6 billion) from 7.2 trillion won previously, citing weaker-than-expected demand for products such as televisions. JPMorgan Chase & Co. last week also said the quarterly earnings may fall short of consensus estimates.
“Some bets that earnings may be below estimates in the second quarter, and speculation that growth of smartphone market may slow a bit in the second half, which I don’t think is the case, are driving the stock lower,” Lee Sun Tae, an analyst at NH Investment & Securities Co. in Seoul who recommends buying the shares, said by phone. “The decline is overdone.”
Samsung Electronics, which last week said it is investigating a complaint that a new Galaxy S III smartphone overheated, today forecast global sales of the device to exceed 10 million units in July, faster than previous models.
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