Analysts say the KOSPI index has greater upside potential than expected as earnings forecasts for major Korean companies including Samsung Electronics and SK hynix continue to be revised upward. For U.S. equities, investors should consider them as long-term investment targets of 10 years or more.
Park Seok-hyun, Deputy General Manager of Woori Bank's WM Products Division, made the remarks at the Woori Finance Forum held at Woori Financial Group headquarters in Hoehyeon-dong, Seoul, on Wednesday, saying "the domestic stock market could rise to levels we have never experienced before."
He analyzed that valuations have fallen to historical lows as the Korean market underwent a correction following the U.S.-Iran war. "If external variables like war affect earnings rather than valuations, you should sell stocks, but that's not the situation now," Park said. "I'm not saying to buy unconditionally, but rather to accumulate gradually."
Samsung Electronics and SK hynix are at the core of the upward revisions to Korean market earnings forecasts. Samsung Electronics in particular is projected to become one of the world's most profitable companies alongside Nvidia by 2027. "Even with the most conservative estimates, there is upside potential of more than 50 percent," Park said. "Samsung Electronics' market capitalization is around 1,200 trillion won, but 2,000 trillion won is achievable."
"Stock prices won't fall until a winner emerges in the artificial intelligence competition and investment efficiency begins," he added. "This is a cycle that comes once in 30 years, so it may not end easily."
At the forum, Jung Na-young, an analyst at Woori Investment & Securities, cited U.S. stocks as a long-term investment target. "It's neither too early nor too late to invest in U.S. stocks," Jung said. "You shouldn't just look at a one-to-two-year horizon but should consider them as long-term investment targets of 10 years or more."
