Morgan Stanley believes Samsung Electronics is reclaiming dominance in the memory market with its "technology leadership-first" strategy, projecting EPS to surge over 150% in 2026 compared to 2025.

Analysts at Morgan Stanley noted in a November 23 report that Samsung has achieved comprehensive catch-up in high-bandwidth memory (HBM). The company's HBM3e products are already shipping to all AI computing clients, while HBM4 is undergoing multi-qualification tests, with initial results expected by early December.

Unlike competitors, Samsung maintains leadership in product quality and specifications without design modifications, leveraging 1c DDR5 front-end technology, 4nm logic base dies, and low-power features. Its unique edge in high-speed (>11 Gbps) applications and end-to-end solutions—from DRAM to foundry to packaging—positions it for significant market share gains.

As the key player controlling DRAM industry dynamics, Samsung currently operates 500k effective DRAM wafer capacity (total ~650k/month), far surpassing rivals. DRAM order fulfillment rates have dropped to ~70% of client demand, with visibility extending into H1 2026.

However, Samsung's management adopts a rational approach—eschewing market hype to collaborate with key clients for sustainable profits based on real demand. The P4 facility's 100k+/month designed capacity provides ample expansion room for both memory and foundry businesses.

Foundry Business Turning Point: 2nm Wins Multiple Orders Analysts see dawn in Samsung's foundry recovery, driven by improved utilization and advanced node performance. Its customer-centric cultural shift is bearing fruit, securing multiple 2nm orders. While yield improvements remain necessary and diversifying beyond Tesla is a priority, the overall outlook has brightened significantly.

Given strong pricing power amid supply constraints, Morgan Stanley forecasts Samsung's 2026 EPS at KRW 14,464—nearly 50% above current market consensus of KRW 9,800. This earnings growth could drive P/E multiple expansion. Analysts highlight that markets remain underprepared for Samsung-specific catalysts, from relative earnings revisions to technological leadership (HBM4) transitions.