Goldman Sachs warns Samsung volatility may spike on Oct. 8 events

Goldman Sachs expects volatility in Samsung Electronics shares to widen on October 8, when the company's preliminary third-quarter earnings fall on the same day as semiconductor ETF rebalancing, options expiry and the end of a share buyback, according to reports by Yonhap and Maeil Business. Both outlets cited a Goldman Sachs FICC and equities report dated October 6 titled on points to watch ahead of October 8. Maeil Business named researcher Heather Oh, who said volatility could increase on that day as the earnings release, possible mechanical selling from ETF rebalancing, options expiry and the buyback's end coincide. Korea Economic Daily headlined the same analysis as Samsung's “fateful 8th” and referred to a Goldman Sachs warning. [ 1 , 2 , 3 ]

The reports said seven semiconductor ETFs are due to rebalance on October 8. Yonhap put their combined assets under management at about 19 trillion won, while Maeil Business reported $14 billion, or about 18.76 trillion won. Because Samsung's weighting in the ETFs is close to their per-fund caps, the market expects mechanical selling in the stock, the reports said, with part of the money leaving Samsung potentially flowing into SK Hynix, SK Square, ISU Petasys, Wonik IPS and Hanmi Semiconductor. [ 1 , 2 ]

The two outlets differed on the timing of Samsung's 15 trillion won buyback. Yonhap said Goldman Sachs expected the programme to be completed on October 6, while Maeil Business said it was expected to wrap up around October 8 and reported that it was 97% complete in value terms as of October 6. Both described the end of buyback support, alongside same-day options expiry, as a factor reducing buying demand. [ 1 , 2 ]

Goldman Sachs cut its third-quarter operating profit forecast for Samsung to 106 trillion won from 112 trillion won, a reduction of about 5%, reflecting a third-quarter average won-dollar rate of 1,418 that came in below its earlier assumption of 1,460. Yonhap and Maeil Business both reported that market consensus stands at about 105.5 trillion won, down from a peak of roughly 114 trillion won in August, and Maeil Business noted Goldman's figure is in line with consensus. [ 1 , 2 ]

The bank kept a constructive view on the chip cycle. It said DRAM and NAND fundamentals are sound and that HBM growth is the most notable, with HBM bit growth expected to rise about 50% quarter-on-quarter as HBM4 shipments ramp up, according to the two reports. Maeil Business added that general DRAM shipments may have been flat because of inventory shortages and a larger share of production going to HBM. [ 1 , 2 ]

On flows, foreign investors net sold Samsung Electronics for five consecutive sessions, totaling $2.6 billion, both outlets reported. From September 1 to October 2, individuals net sold $7.5 billion, foreigners $3.4 billion and pension funds $0.3 billion, while buybacks accounted for $8.5 billion and domestic institutions $2.5 billion of net buying, according to the reports. Both said Goldman Sachs identified the possible return of foreign buying on October 8, and whether the company maintains strong earnings momentum and guidance, as the key points to watch. [ 1 , 2 ]