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SAMSUNG

Analysis before buying or selling Samsung shares

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The mobile telephone market and all that relates to new technology is highly popular with stock market investors at present. The big names in this sector which are listed on the major stock exchanges offer assets often appreciated by online traders. This is indeed the case with Samsung Group shares that we will look at closely here with detailed and practical information that will assist you in analysing the price and rates.

Latest news

Samsung's revenue and market capitalization

24/12/2021 - 09h22

Samsung reported strong results for the full year 2021 and the first 3 quarters of 2022. It has an impressive value as a market capitalisation.

Elements to consider before selling or buying Samsung shares

Analysis N°1

First of all, it is necessary to keep an eye on the group's innovations by monitoring in particular the investments made by the group in research and development with the aim of offering technological products and facing up to the competition.

Analysis N°2

It will also be necessary to monitor the diversification of the group's activities towards new products and services with major positions taken in new technologies and new markets.

Analysis N°3

The group's pricing strategy will also be closely monitored in view of the arrival on the market of numerous competing products of equivalent quality and sold at more affordable prices for the general public.

Analysis N°4

The strategic partnerships that the group may enter into with other companies to develop new innovations or collaborate on major projects will also need to be carefully monitored.

Analysis N°5

Samsung's business is very sensitive to global economic health and certain crises, such as the recent Covid pandemic, may cause it to temporarily lose profitability.

Analysis N°6

The group's competition with the major players in this sector will also have to be closely monitored, as will smaller players and local players who may take market share.

Analysis N°7

Finally, it will also be necessary to take an interest in the evolution of the group's results and its growth and strategic development plans as these may influence the positions taken by traders and shareholders.

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General presentation of Samsung

Let's now discover the Samsung group with a detailed presentation of this company and its activities. This will allow you to better understand its challenges by understanding how the group makes its profits and in which segments and markets.
Samsung Electronics Co Ltd is a Korean-based company that specialises in the electronics sector. More specifically, the company's core business is the production and distribution of electronic products.
But the group is actually active in three different sectors, including

  • The Information Technology and Mobile Communications sector, which generates 42% of the company's turnover with computers, mobile phones, network systems, digital cameras and others.
  • The Device Solutions segment, which accounts for 30.7% of the group's revenue and includes semiconductors and display elements such as dynamic random access memory, flash, thin film transistor liquid crystal displays and other products.
  • The consumer electronics sector accounts for 32.9% of the group's turnover and includes colour televisions, monitors, printers, air conditioners, refrigerators, washing machines and other such products.
  • Finally, the remaining 3.9% of Samsung's turnover comes from the Harman segment, which produces head units, infotainment, telematics and speakers.

The Samsung Electronics group currently distributes its products both on the domestic Korean market and internationally. Specifically, it generates 32% of its turnover in the Americas, 19.4% in Europe, 15.9% in China, 15.9% in Asia and Africa and 15.6% in South Korea. Currently, the number of employees at Samsung is 109,490.

Analysis before buying or selling Samsung shares
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The major competitors of Samsung

The Samsung Group naturally faces strong competition in all the segments in which it operates. We therefore suggest that you find out here who its main rivals are in these sectors:

Xiaomi Corporation

This Chinese electronics and computer company also offers mobile phone and consumer electronics products. It is the third largest smartphone vendor after Samsung and Apple.

Intel Corporation

In the semiconductor segment, the American group Intel Corporation is of course worth watching as it is the second largest player in this market after Samsung in terms of turnover. It produces microprocessors, flash memories, motherboards and graphics processors, among other things. The company is listed on the Nasdaq under the symbol INTC and has been led since 2021 by the former CEO of WMWare.

Taiwan Semiconductor Manufacturing

This other company is currently one of the largest semiconductor foundries in the world and is therefore in direct competition with Samsung in this segment. The TSMC group produces, for example, graphics chips for NVidia or systems on a Snapdragon chip from Qualcomm and chips from Apple.

LG Corporation

This company, formerly known as the LG Group or Lucky Goldstar, is a South Korean chaebol or industrial conglomerate or holding company, specialising in the field of electronics, including home automation, mobile phones, air conditioning, small household appliances and also in business solutions, including solar and security. It is also a family business that was created by the Koo family, which still holds stakes in 17 subsidiaries of the LG group, including 45.25% in LG Chemical and 35.89% in LG Capital Services.

Whirlpool

Finally, and with regard to Samsung's competition in the household appliance sector, we should also take into account the American company Whirlpool, which specialises in the design, production and distribution of household appliances and which is currently number two in this segment after LG.


The major partners of Samsung

Thanks to various partnerships, Samsung has been able to maintain a good reputation in this business sector. Here they are in further detail.

Apple

In 2017, Samsung established a partnership with Apple for the creation of a curved screen for the next iPhone.

Tesla

In 2017, Samsung also signed a deal with Tesla regarding the design of its mobile phone’s batteries.

Microsoft

Finally, the company also has an extended partnership with Microsoft in the field of professional mobility which was renewed in 2017 in view of new projects.

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Positive factors for Samsung shares
The factors in favour of a rise in the Samsung share price:

Concerning the factors favourable to a rise in this asset price we note the following in particular:

  • Firstly, one of the principal arguments in favour of a long rising trend of the Samsung share price relates of course to the long experience of this company in its activity sector.  The Samsung Company has in fact been present in this market for several decades now and has succeeded in developing an excellent brand image as well as a worldwide reputation for superior knowledge and capabilities in its chosen sector.
  • The marketing strategy followed by Samsung should also be noted for its efficacy.  In fact, this company has done everything possible to target a wide range of clients by developing a varied assortment of products with numerous models and options at a wide range of prices. This in turn has enabled the company to significantly increase its sales achieved from each of its new devices which are available in different models of which the price varies according to the options or size.
  • The Samsung Group has also succeeded in positioning itself in an advantageous manner in certain specific parts of its chosen sector.  We can notably point out a real advantage of this company in terms of its position among the largest manufacturers of televisions and mobile telephones worldwide. In this manner it benefits from a position of strength for negotiations and an excellent presence on the international market.
  • Still on the subject of factors in favour of a rise in the Samsung share price, we can also mention the fact that this company has shown itself capable of making high quality strategic alliances with other large high tech companies. It has also shown its ability to introduce new increasingly popular and perfect models onto the market while decreasing production costs to a minimum to favour its margins and increase the possibility of reducing its sales prices.
  • This brings us to another favourable factor for the Samsung share price which relates this time to the innovative abilities of this group. Samsung has in fact greatly invested in research and development and is renowned for regularly introducing new and innovative product models onto the market. In this manner it retains a certain dynamism and maintains its leadership against its major competitors.
  • The diversification of the Samsung Group’s activities is another undeniable advantage. The group is in fact above all renowned for the products it creates, manufactures and sells including telephones, computers and household appliances, but it is also a large manufacturer of parts and accessories such as LCD monitors, memory cards and other components destined for other manufacturers, sometimes even the direct competitors to Samsung.
  • In the mobile telephone sector generally called smartphones we can also note that Samsung is currently the leader in terms of sales just above its major competitor Apple. This success is notably due to its Galaxy series of products which continues to benefit from a high degree of popularity on this market. This range of smartphones was in fact the first to effectively create competition for the iPhone telephones produced by Apple.
  • Another indirect argument that should be considered before launching into trading in this share price concerns the work force of the Samsung Company. This company currently employs over 400,000 people around the world which of course avails this company of a significant strength in terms of production as well as sales. The size of this workforce is therefore also a significant indicator of the success enjoyed by this company and its strength in terms of development.          
  • And finally, the last argument in favour of a rise in the Samsung share price concerns the international status of this company which sells its products worldwide. Samsung is particularly well positioned in the emerging markets such as Asia to which it is close geographically speaking, in this area it is one of the leaders in terms of high tech product sales.
Negative factors for Samsung shares
The factors in favour of a drop in the Samsung share price:

As you may have noted from reading the precedent arguments, there are numerous factors in favour of a long rising trend in the Samsung share price. However, the situation is not that simple as the group also has certain weak points and factors that could negatively impact the positive trend in its price. We now offer you the opportunity to learn about the two principal arguments in favour of a drop in the Samsung share price.

  • Firstly, we can of course note the strong competition to the Samsung Group as its major handicap. Since the arrival of smartphones in the mobile telephone sector, the market share of this company in this sector has fallen overall even though Samsung remains the leader. This is notably due to the entry of other companies in this sector and the competition they represent such as the Korean firm Huawei that manufactures advanced technological products at a slightly lower price than Samsung. In this highly specific market context, the possibilities for growth and development of the Samsung Group remain fairly limited.
  • And, to conclude, the second argument in favour of a drop in the Samsung share price relates this time to the numerous problems that this company has encountered with some of its patents that have been contested by its long time competitor Apple.  Although these files are now classified the investors are still anxious about the possibility of new and similar scandals in the future and can at times appear reticent to take buying positions on this asset due to this lack of confidence. Also, these patent disputes have also contributed to a downturn in the Samsung brand image as perceived by the general public.
The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

How has the turnover of the Samsung Group evolved over time?

If we examine the Samsung Company’s turnover over the last few years we note that between 2009 and 2019 this ranged between 154.05 and 221.57 billion dollars. Between 2011 and 2013 this turnover grew by 41% before falling by 20% between 2013 and 2015. Then we can observe a stabilisation at around 220 billion dollars between 2017 and 2018 and for the last year’s published results, that for the 2019 financial year we note a turnover of 207 billion dollars.  

Are the financial ratios of the Samsung share price attractive?

At present, in January 2020, regarding the stock market share price of the Samsung Company the financial ratios of this asset are overall quite promising with a stock market share price of 47.83 dollars and a profit generation of 3,166 KRW per share in 2019, that represents 2.74 dollars per share.  The profitability ratio of this share is therefore attractive as it represents 5.73% for this period.       

How to follow the Samsung share price?

The Samsung share price is fairly easy to follow as this company is renowned worldwide, the asset is therefore quoted on numerous websites specialised in the stock markets. You could of course also consult online innovative stock market charts on this asset directly available from your trading platform that can be customised according to your requirements.

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