Goldman Sachs Lowers Kospi 12-Month Target to 9,000 Amid Volatility and Earnings Concerns
Goldman Sachs has reduced its 12-month target for South Korea's benchmark Kospi index from 12,000 to 9,000. The revision is driven by increased market volatility, slowing earnings momentum, and significant foreign outflows totaling approximately $1 billion. Despite the reduction, the bank maintains an 'overweight' stance, noting that the new target still represents a potential upside of over 60% from current levels. The report highlights extreme valuation discounts, with the Kospi trading roughly three standard deviations below its historical average. While memory chip valuations reflect concerns regarding long-term earnings sustainability, Goldman identifies significant value in non-memory stocks, which it estimates are undervalued by more than 30%. The bank suggests diversifying into sectors such as power, industrials, and corporate governance reform beneficiaries.
Topics: Equity Valuation Goldman Sachs Report Kospi Index Memory Chips South Korea Economy