Disclaimer: This article is for informational purposes only and does not constitute financial advice.
Investment Thesis and Target Price
Mirae Asset Securities maintains a Buy investment rating and a Target Price of 2,800,000 KRW (~$1,976 USD based on 1417 KRW/USD) for SK Hynix. Despite a 51% decline from its peak due to profit-taking and market supply-demand challenges, the brokerage views the current price level as an over-correction given the operating environment and industry outlook. Valuation multiples have dropped to pre-AI levels, with a 12-month forward P/B of 1.8x and a P/E of 3.5x. The brokerage also views the potential Pre-IPO and US listing of Solidigm not as a double-listing risk, but as a strategic move to recover M&A investments and secure future investment resources, potentially securing approximately $15 billion in US investment capacity.
Earnings Estimates and Financial Preview
For the full year 2026F, the brokerage estimates Revenue of 346.9 trillion KRW (~$244.8B USD) and Operating Profit of 268.1 trillion KRW (~$189.2B USD), which slightly exceeds the market consensus of 266.4 trillion KRW (~$187.3B USD). The estimated operating margin for 2026F is 77.3%. Regarding shareholder returns, the brokerage estimates a potential return scale of approximately 40 trillion KRW (~$28.2B USD), supported by an estimated 2026 Free Cash Flow (FCF) of 180 trillion KRW (~$127.0B USD) and accumulated net cash of 173 trillion KRW (~$122.1B USD). Based on current stock prices, a dividend yield of up to 3.9% is expected.
Key Semiconductor Drivers and Outlook
The growth is driven by strong performance in both DRAM and NAND Flash. For 2026F, DRAM revenue is projected at 259.2 trillion KRW (~$183.0B USD) and NAND revenue at 86.4 trillion KRW (~$60.9B USD). A key driver is the significant increase in Average Selling Prices (ASP); DRAM ASP is projected to rise from 0.42 USD/Gb in 2024 to 1.44 USD/Gb in 2026F. In the NAND segment, the company has successfully internalized controller design capabilities through the acquisition of Intel’s NAND business, with high-performance enterprise SSDs primarily based on the company’s own TLC design and production technology, while Solidigm focuses on QLC.
🔗 Original Source: View the official filing/article here.