Samsung Electronics Shares Slide After Return Plan Is Delayed

(Bloomberg) -- Samsung Electronics Co. ( 005930.KS ) shares reversed earlier gains to slide as much as 6.6% as the lack of a new shareholder return plan in its earnings disappointed investors.

The Korean chipmaker said it will announce the plan at the end of January, a contrast with its peer SK Hynix Inc. that delivered a blockbuster earnings report Wednesday along with its intention to return about $45 billion more to shareholders. Sentiment toward Samsung was also hurt as profit from the company's chip operations missed estimates and capital expenditure expanded.

"Making the market wait until January for the full return plan has left a hole right where the good news should have been," said Josh Gilbert, an analyst at eToro. "Samsung is also lifting capex by around 60% this year, so until it spells out how this windfall gets split between new capacity and shareholders, there's a genuine question mark over how much actually comes back to investors."

Samsung said in August it planned to return as much as 110 trillion won ($82.5 billion) to investors this year.

"Deferring the shareholder return details to January is disappointing," said Rob Li, managing partner at New York-based Amont Partners. "This gives excuses to stock traders to rotate money to SK Hynix or Micron in the next few months as the other two have a clearer shareholder return path."

South Korea's Kospi index fell as much as 3.2% after surging 6.6% on Thursday. SK Hynix pared its earlier gains of 6.7% to be up by 1.8%.