Samsung Electronics - Time for A Special Dividend
On 30 July, Samsung Electronics (005930 KS) announced that it plans to soon unveil its shareholder return strategy for the year, which will include a special dividend.
My analysis suggests that the special DPS could be about 8,648 won per share. This represents dividend yields of 4.2% for common shares and 5.7% for preferred shares.
I provide a detailed calculation of the special dividends for Samsung Electronics.
On 30 July, Samsung Electronics (005930 KS) announced that it plans to soon unveil its shareholder return strategy for the year, which will include a special dividend.
My analysis suggests that the special DPS could be about 8,648 won per share. This represents dividend yields of 4.2% for common shares and 5.7% for preferred shares.
Overall, despite recent share price declines, Samsung’s aggressive shareholder returns (especially special dividends) could buck this declining trend and I think Samsung’s shares start to outpeform the market once again.
The following is how I derived this amount:
1) Cumulative free cash flow - Samsung Electronics has designated 50% of the cumulative free cash flow (FCF) generated over the three-year period from 2024 to 2026 as the total pool for shareholder returns.
In 2026, the consensus estimates Samsung Electronics to generate free cash flow of 233.8 trillion won. Samsung Electronics generated free cash flow of 59.4 trillion won in 2024 and 2025.
So the combined estimated free cash flow of Samsung Electronics would be 293.2 trillion won from 2024 to 2026. A 50% of this amount is 146.6 trillion won.
2) Share buyback/cancellations - Back in November 2024, Samsung Electronics announced a massive share buyback program worth 10 trillion won.
In February 2025, the company cancelled an initial batch of repurchased shares valued at 3.1 trillion won. In 1H 2026, Samsung Electronics executed share cancellation of nearly 16 trillion won.
So the combined amount of share buyback/cancellations would be 19.1 trillion won from 2024 to 2026.
Regarding this buyback/cancellations, I think the more appropriate figure is to use the 19.1 trillion won (total amount of cancellations), rather than the original proposed buyback amount of 10 trillion won since the company completed the share price at higher share prices than when the buyback was initially announced.
