Samsung drops 4.6% in Seoul amid forex worries


The Korean won's strong performance over the last six months is leading a growing number of analysts to worry Samsung's (SSNLF, SSNGY) Q4 results will miss estimates.

The company's chip business is especially vulnerable to forex swings, since it relies on dollars for order settlement. BNP Paribas estimates every 1% change in the won/dollar exchange rate hurts the op. profit of Samsung's chip division by 4%.

Citing exchange rates and (to a lesser extent) margin pressure for Samsung's OLED display business, IBK Investment is now expecting the electronics/display/chip giant to post a Q4 op. profit of KWT9.5T ($9.04B), below a KWT10.3T Thomson Reuters consensus.

Korean automakers Hyundai (HYMLF -5.1%) and Kia (KIMTF -6.1%) also fell hard in Seoul overnight. South Korea's benchmark KOSPI index fell 2.2%.

Korean ETFs: EWY, FKO, KORU, KORZ, DXKW

Comments (1)
  • Jack Baker
    , contributor
    Comments (1284) | Send Message
     
    Don't forget that their 4g isn't selling well and Apple is cleaning their clock at the high-end of the smart-phone market.
    2 Jan 2014, 04:10 PM Reply Like
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