20171227-三星证券-Focus_to_shift_from_seasonality_to_fundamentals_42页_2mb

Samsung Market Strategy Summary

Core Content

The Samsung Model Portfolio strategy for January 2018 outlines a shift from seasonal market trends to fundamental analysis. It emphasizes the importance of macroeconomic conditions, corporate earnings improvements, and monetary easing for equities. The report highlights the performance of the portfolio compared to the Kospi index and details changes in sector exposure and specific company weightings.

Main Points

• Performance Review (Nov 27 - Dec 26):

  • Samsung Model Portfolio fell by 2.50%, outperforming the Kospi by 71 basis points.
  • The Kospi index fell by 3.21% over the same period.
  • The relative performance of the Samsung Model Portfolio was 0.71% in the first month, 2.02% in three months, 3.38% in six months, and 6.98% in twelve months.

• January Outlook:

  • Seasonal trends in January, such as preference for Kospi small caps and Kosdaq-listed firms, are expected to continue due to tax avoidance strategies.
  • Once the seasonality subsides, the focus should shift to fundamentals.
  • The MSCI Korea's forward EPS estimates have been revised up by about 6% over the past three months, indicating sustained EPS growth momentum, albeit slowing.
  • The IT and telecom services sectors have seen higher EPS forecast revisions compared to other sectors.
  • The target band for the Kospi in January is set at 2,420-2,580.

Key Portfolio Changes

• Sector Exposure Adjustments:

  • Increased exposure to Materials (10% vs 9%), Industrial Goods (14% vs 12%), and Consumer Discretionary (14% vs 13%).
  • Decreased exposure to Energy (3% vs 4%), IT (33% vs 35%), and Healthcare (4% vs 5%).
  • The portfolio beta for January is 0.96, up from 0.94 in December.

• Company Additions:

  • Hanwha Chemical, LG Corporation, Poongsan, Doosan Bobcat, Hansae, Huons, and Webzen are added to the portfolio.

• Company Removals:

  • SK Corporation, SK Materials, LG Chem, Korea Zinc, Mando, Samjin Pharmaceutical, and TES are removed from the portfolio.

• Exposure Adjustments:

  • Increased exposure to Hyundai Motor and Posco Chemtech.
  • Decreased exposure to SK Innovation and Hanmi Pharmaceutical.

Key Information

• Performance Metrics:

  • The relative performance of the portfolio is compared to the Kospi across different timeframes (1-month, 3-month, 12-month).
  • The report includes detailed performance data for each added and removed company.

• Industry-Specific Analysis:

  • The IT and telecom services sectors have shown stronger EPS forecast revisions.
  • The Energy, Materials, and Financials sectors are in line with the market.
  • The Industrial Goods, Consumer Discretionary, and Healthcare sectors have seen downward EPS forecast revisions.

• Market Outlook:

  • The Kospi is expected to be undervalued, with the exception of the Healthcare sector.
  • The Kospi target band for January is 2,420-2,580.

Appendices

• The document includes detailed tables showing the portfolio weightings by sector, changes in sector exposure, and performance metrics for each company.
• It also provides relative performance data, P/E ratios, P/B ratios, EV/EBITDA growth, EPS growth, EBITDA growth, ROE, and dividend yield for each company in the portfolio.

Summary of Strategy

The strategy recommends a shift from seasonal trends to fundamentals, with an emphasis on cyclical sectors and a reduction in exposure to IT and financials. The portfolio is adjusted to include companies in materials, industrial goods, and consumer discretionary sectors, while reducing exposure to energy, IT, and healthcare. The report also highlights the importance of monitoring external factors such as Kim Jong-un's New Year's Speech and US infrastructure policies for potential market impacts.