Samsung Shares Tumble $12 Billion in Valuation on Galaxy S4 Sales Concerns

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News Posted: Fri, Jun 7 2013 11:44 AM
As we've seen time and again, investors are a fickle bunch, and skittish too. Lest we need reminding of that, it's being reported that shares of Samsung in Seoul have fallen more than they have in the past nine months, and it's all because JPMorgan Chase & Co. noticed a slowdown in Galaxy S4 sales. So began the domino effect, which led to JPMorgan cutting profit estimates for Samsung, and that in turn resulted in Samsung's share price dropping 6.2 percent, the steepest decline since August 27, 2012. That might not sound like much, but it was enough to drop Samsung's market capitalization by $12 billion - ouch!

According to Bloomberg. JPMorgan cut its share price estimate for Samsung by 9.5 percent and also reduced its 2013 earnings estimate by 9 percent. The investment company noted that the Galaxy S4 "had stronger momentum in the first quarter of launch," but is nevertheless expecting next quarter's shipments to be "disappointing" after conducting a round of supply chain checks.

Samsung Galaxy S4

Specifically, JPMorgan expects S4 shipments to total 60 million this year, down 20 million from its previous estimate. Why the drop? It could be that smartphone users are still content with the S3. The S4 brings some nice upgrades and compelling feature upgrades to the table, but nothing that really blows the S3 out of the water.

The Galaxy S4 got off to a fast start when it debuted at the end of April and notched 10 million sales in less than a month.territories via 327 partners.
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near $700 for an off-contract phone, will put a damper on sales...can buy a half decent laptop computer for that price. I'd still cough up the cash for one of these over an iPhone

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I plan to get one. Gotta wait on my current contract to expire this year. Im willing to bet many other potential buyers are in the same boat.

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Dave_HH replied on Fri, Jun 7 2013 8:32 PM

I think the market is just getting plain saturated at this point.

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SmogHog replied on Fri, Jun 7 2013 9:00 PM

This is a great example of how the stock market is manipulated by Wall Street.

These Wall Street analysts are the ones who "estimated" how many S4 phones would ship so for the target to miss it's point is only to say that they made a bad guess to begin with.

Samsung didn't do the estimations.

Buy Samsung Electronics while it's down.

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sevags replied on Fri, Jun 7 2013 9:32 PM

I agree with Dave, it's over saturation. It isn't that the S4 is starting to do bad but it's not like apple where a phone comes out and for a year there is nothing else, it's samsungs fault for offering alternatives to the s4. There is the S4 Mini that will take away some sales of the full sized s4 and now there is the galaxy s4 Active which is an s4 but much tougher and water resistant which is the galaxy phone to get in my opinion. So within a month or two from release Samsung gave people reasons NOT to buy the s4. As a whole the 3 phones could end up selling more units than the S4 could have alone, only time will tell and clearly investors are impatient.

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