Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

I investigate special situations, pairs, and index rebalancing trades in Korea.

Korea / Special Sits, Pairs, Index Rebalancing

Samsung Electronics Earnings Review and Read Thru

Hynix Earnings Recap - Oh, Oh - Is Everyone Running the Same Direction?

Samsung Elec Dividend or Buyback? Tax & Net Cash-In Calculations to the Family

The Passing of Samsung Lee Kun-Hee: Checking Immediate Issues

Samsung Dividend Play, Hedging-Adjusted with Futures

Event-Driven

<p>Samsung postponed the finalization of a new 3-yr shareholder return plan. Also, they delayed the execution of the current plan's remaining to meet the 3-yr 50% FCF target to the next quarterly earnings call.</p><p>Was it a surprise?</p><p>Well, they need price management in the next two months to prevent the price from soaring for the inheritance taxes.</p><p>It is a 2-month before and after the passing date. The 60D prior was ₩58,515. The 60D post so far sits at ₩59,325. Understandably, they would want to be cautious.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Family shareholding in Electronics"}'>Inheritance taxes calculation period</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Start"}'>Start</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ending"}'>Ending</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"60D avg."}'>60D avg.</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Reference date"}'>Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44129}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"60D prior"}'>60D prior</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44068}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 8. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44128}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 24</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":58515}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[10]C[-2]:R[49]C[-2])">₩58,515</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"60D post"}'>60D post</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44129}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44189}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 12. 24</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":59325}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[5]C[-2]:R[8]C[-2])">₩59,325</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - So far"}'>- So far</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44068}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 8. 25</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44133}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2020. 10. 29</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":58588.63636363636}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=average(R[4]C[-2]:R[47]C[-2])">₩58,589</td>
</tr>
<tr><td colspan="4" rowspan="1" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><p><strong>But it doesn't mean that we have less chance to hear year-end special bonus (either dividends or buyback) for this year.</strong></p><p><strong>So, let's objectively estimate the current 50% FCF situation based on the latest data given in yesterday's earnings call.</strong></p>

Samsung postponed the finalization of a new 3-yr shareholder return plan. Also, they delayed the execution of the current plan's remaining to meet the 3-yr 50% FCF target to the next quarterly earnings call.Was it a surprise?Well, they need price management in the next two months to prevent the price from soaring for the inheritance taxes.It is a 2-month before and after the passing date. The 60D prior was ₩58,515. The 60D post so far sits at ₩59,325. Understandably, they would want to be cautious.








Inheritance taxes calculation period
Start
Ending
60D avg.


Reference date
2020. 10. 25
-
-


60D prior
2020. 8. 25
2020. 10. 24
₩58,515


60D post
2020. 10. 25
2020. 12. 24
₩59,325


- So far
2020. 8. 25
2020. 10. 29
₩58,589

Source: KRX

But it doesn't mean that we have less chance to hear year-end special bonus (either dividends or buyback) for this year.So, let's objectively estimate the current 50% FCF situation based on the latest data given in yesterday's earnings call.

Samsung Electronics Pref Shares (005935 KS)

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