Samsung C&T target prices surge on Samsung Electronics dividend outlook, nuclear ambitions

Securities firms have been raising their target prices for Samsung C&T in rapid succession, citing a combination of factors: expectations of stronger shareholder returns tied to Samsung Electronics' expanded dividends, growth prospects in nuclear power and small modular reactor projects, and an improving earnings outlook for the high-tech construction segment.

DS Investment & Securities on Friday sharply raised its target price for Samsung C&T from 380,000 won to 620,000 won. On the same day, LS Securities lifted its target from 550,000 won to 630,000 won, while IBK Investment & Securities had earlier raised its target from 350,000 won to 620,000 won. Samsung C&T closed at 485,500 won on Wednesday.

The factor drawing the most attention from analysts is the prospect that rising equity value in Samsung Electronics — and its expanded dividends — could translate into stronger shareholder return policies at Samsung C&T. The company holds stakes in major affiliates including Samsung Electronics, Samsung Life Insurance and Samsung Biologics, and those holdings account for more than 90 percent of Samsung C&T's net asset value.

"Samsung C&T's investment thesis starts with a revaluation of its equity holdings and the potential for expanded shareholder returns," said Cho Jeong-hyeon, an analyst at IBK Investment & Securities. "As share prices at key affiliates rise, the value of those holdings is growing, which increases the likelihood of a NAV revaluation."

Expectations of higher dividends are also a key driver behind the target price upgrades. Kim Su-hyeon, an analyst at DS Investment & Securities, estimated that from 2026 through 2028 — years when Samsung Electronics is expected to pay large dividends — Samsung C&T would redistribute 60 to 70 percent of the dividend income it receives from affiliates including Samsung Electronics and Samsung Life Insurance. Kim projected Samsung C&T's dividend per share for 2026 at 23,050 won, implying a dividend yield of 4.8 percent — a 720 percent increase from the prior year. The per-share dividend for 2027 was forecast to reach 41,030 won, for a yield of 8.6 percent.

Kim particularly highlighted the potential for a revaluation of Samsung C&T's corporate value, drawing a comparison with SK Square, which has a market capitalization of 210 trillion won. "SK Square's dividend scale is uncertain, whereas Samsung C&T's large-scale dividends have a clear predictability advantage," Kim said. "When you factor in the value of its own businesses — construction, SMR and others — the gap in market cap between the two companies is excessive. As the market moves into a phase of seeking alpha in the second half of the year, Samsung C&T's transparent dividend policy is likely to stand out as an attractive option."

Optimism about Samsung C&T's core construction business is also running high. Analysts expect that as finishing work on the Pyeongtaek P4 facility and structural work on P5 ramp up from the second quarter onward, the company's high-tech segment order volume this year could exceed its existing guidance of 6.8 trillion won.

"While the rise in equity value at key affiliates is a factor driving a share price re-rating, the time has come for the market to also price in a business value revaluation based on tangible order wins in nuclear power and SMR within the construction segment," said Kim Se-ryeon, an analyst at LS Securities.

Cho of IBK Investment & Securities agreed, saying the company is entering a phase "where a recovery in its core business driven by the high-tech investment cycle can occur simultaneously — equity value lifts NAV, dividend income flows into shareholder return resources, and the core business recovers through the high-tech investment cycle."

Some market observers say Samsung C&T is being reappraised as more than a simple holding company — one that combines dividend appeal with genuine business growth potential. If the company's exposure to national strategic industries such as semiconductors, nuclear power and SMR continues to expand, assessments of its core business competitiveness — not just its equity holdings — could improve further, making future earnings and order results key variables for the stock's trajectory.

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https://biz.heraldcorp.com/article/10782031