Disclaimer: This article is for informational purposes only and does not constitute financial advice.
Investment Thesis and Target Price
Kyobo Securities has maintained an Investment Rating of Buy and a Target Price of 4,000,000 KRW (~$2,783 USD based on 1437 KRW/USD) for SK Hynix. The valuation is supported by the expansion of High Bandwidth Memory (HBM) 4 mass production, increased shipments of 1c-based server DRAM, and the securing of mid-to-long-term demand visibility through Long-Term Agreements (LTAs). Despite recent share price declines due to intensified memory competition from China and credit risks among Big Tech firms, the brokerage believes the memory cycle will persist given the inevitable nature of continuous investment amid US-China hegemony competition. Further catalysts for stock price appreciation include second-half earnings growth and the expected announcement of additional shareholder returns within the year.
Earnings Estimates and Financial Preview
For 2Q26, SK Hynix recorded revenue of 79.3 trillion KRW (~$55.17B USD, QoQ +51%) and operating profit of 60.5 trillion KRW (~$42.10B USD, QoQ +61%), marking the fifth consecutive quarter of record-high operating profits. The operating profit margin (OPM) rose to 76%, driven by increased shipments and price hikes in both DRAM and NAND Flash, alongside cost improvements. Specifically, DRAM is estimated to have generated 48.2 trillion KRW (~$33.54B USD) in operating profit (OPM 83.0%) with an ASP increase of 30%, while NAND Flash contributed 13.1 trillion KRW (~$9.11B USD) in operating profit (OPM 66.0%) with an ASP increase of 49%. For the full year 2026, the brokerage forecasts revenue of 337.6 trillion KRW (~$234.93B USD) and operating profit of 263.3 trillion KRW (~$183.23B USD).
Key Semiconductor Drivers and Outlook
The primary growth drivers for the second half of 2026 are the expansion of HBM4 and 1c-based products, which are expected to improve both volume and product mix. HBM4 began mass production shipments in the second quarter, with full-scale production expansion scheduled for the second half. Furthermore, the company has finalized LTA negotiations with approximately 10 customers, including key clients, ensuring long-term demand visibility. The brokerage anticipates continued growth driven by the proliferation of AI services and sustained infrastructure investment by Cloud Service Providers (CSPs).
🔗 Original Source: View the official filing/article here.