Some Samsung's investors are worried about the company's long-term prospects as they fear that the South Korean tech giant already reached its peak growth or will soon do so, Reuters reports. The Seoul-based consumer electronics manufacturer has been posting record profits in recent years, with its shares surging to new highs even amidst a massive corruption scandal that led to the arrest of Samsung Group's Vice Chairman Jay Y. Lee. Not even last year's Galaxy Note 7 debacle made a significant impact on the company's operations, as the Galaxy brand survived the ordeal mostly unscathed. However, investors are now worried that Samsung Electronics won't be able to keep up with the new expectations that arose following the company's massive success.
The shares of the South Korean company experienced a 60-percent increase in the last 16 months, which is an achievement that many industry analysts believe Samsung won't be able to repeat, thus basically becoming a victim of its own success. Most of those concerns pertain to Samsung's long-term operations, while the outlook is much more positive in the short term. The company's chip-making division is still posting record profits thanks to a surge in chip prices, while the upcoming Galaxy S8 and the Galaxy S8 Plus are expected to make up for the Galaxy Note 7 fiasco that cost the firm billions of dollars. Regardless, many investors are reportedly skeptical about Samsung's ability to maintain its incredible growth in the coming years. Park Jung-hoon of HDC Asset Management told Reuters that the concerns outlined above will likely grow over time, but admitted that no single investor would be willing to be the first to dump Samsung's stock.
Likewise, while some analysts aren't confident Samsung will continue to grow at a rapid pace over the coming years, virtually no one expects the firm's stock to crash, especially in light of the fact that despite all recent growth, most industry watchers agree Samsung is still undervalued as a company, especially compared to other tech giants like Apple. Due to that state of affairs, Samsung's stock can still be considered a safe investment, most analysts believe.