Samsung’s stock traded lower on Monday, with shares declining 1.08%, or 600 won, at 54,900 won. The company was recently shaken up by the graft and corruption allegations against the Samsung Group heir.
On Monday, the billionaire, Jay Y. Lee, appeared in court for a hearing that will determine whether the company’s heir will serve another sentence in jail. The court’s decision is expected to be known either by late Monday or Tuesday morning.
The corruption allegations date back to 2015 when Lee took control of the huge company. It is speculated that he used illegal means to climb up to his high position in Samsung Group. Although Lee already served almost a year in prison and was released in February 2018, prosecutors argue that he should be sent back to jail due to new but similar allegations.
Samsung Group was founded by Jay Y. Lee’s grandfather and led by his father until 2014, when he suffered a heart attack. This made Lee the current heir of the conglomerate but the circumstances surrounding his inheritance are questioned by many. In 2017, he was charged for bribery after providing different forms of payments to a confidante of the ex-Samsung president. This probably made Lee’s succession easier but angered South Korea’s public, increasing the bad opinion about huge conglomerates.
While both Lee and Samsung are determined to clear their names, the new allegations against the chaebol may disrupt the company’s reputation and success. Investors worry about the future of Samsung after the court’s decision and this led to the drop in shares in Monday trading.
Analyst stock price forecast and recommendation
According to Investing.com, analysts who offer a 12-month price target forecast for Samsung Electronics Co. have an average price target of 64,378, with a high estimate of 77,000 and a low estimate of 50,000. The company has a potential upside of 17.26%.
The same media also offers the recommendations of 41 investment analysts who have a consensus rating of “Outperform” for the Samsung Electronics Co. stock. Among the polled analysts, 37 ranked the company’s stock as “Buy”, while 4 are “Neutral”.