SK Hynix (SKHY): Korean Memory Giant Earns 3 Buy Calls

Multiple Wall Street research firms have kicked off their coverage of SK Hynix (SKHY) shares with high hopes for the South Korean computer-memory firm just a few weeks after its U.S. market debut.

On Tuesday, Aug. 4, Stifel, Wedbush, and William Blair offered up their first ratings on SK Hynix following the company's July 10 initial public offering (IPO). The company raised $26.5 billion for its American Depositary Shares (ADSes), marking the largest U.S. IPO for a foreign company.

Little has gone right since then. SKHY shares were priced at $149 per share then quickly peaked at $193, but have since lost nearly a quarter of their value in the midst of a global downturn for chip and memory names including Taiwan Semiconductor (TSM), Micron (MU), and Samsung.

Tuesday's news, then, was greeted with a deep sigh of relief ... and strong buying in SKHY stock.

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3 Buy-Equivalent Calls for SKHY Stock

SK Hynix is one of the world's top suppliers of advanced DRAM and NAND memory-based storage products and devices, and DRAM specifically is seeing a spike in demand given its importance within artificial intelligence (AI) infrastructure.

"The memory industry has never been in a stronger place, structurally," say Stifel analysts, who initiated their coverage of the company with a Buy rating. "Above all, memory has not been as vital as it is now to the buildout of AI super intelligence in datacenters around the globe."

What do they like about SK Hynix specifically?

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"SK Hynix has played a leading role, as a first mover in the development/commercialization of high bandwidth memory (HBM), a specialized DRAM product well-suited to feed data to fast/hungry GPUs/accelerators for AI model training or inference (i.e., application of the model)," Stifel's analysts say. "SK hynix’s technology leadership has vaulted them to a leading share position in HBM (>60% in CY25), and we expect the company to go from strength to strength, as its product offering for AI infrastructure/edge memory further evolves."

Stifel analysts initiated their coverage of the company with a Buy rating and a $240 target price, implying 68% upside from Monday's closing price. They noted that SK Hynix's stock traded at a consistent discount to U.S. peer Micron prior to its U.S. listing, but they believe the stock is due to be re-rated, both because of its relative valuation against peers and because they see the broader memory sector as still underappreciated.

That underappreciation continues despite SK Hynix squeezing everything it can out of the current memory supercycle. Prices have tripled over the past six months thanks to limited supply expansion, and SKHY has delivered record revenues and margins as a result.

"We expect that sticker pricing for AI memory and a slow ramp-up of new supply are likely to keep the company’s earnings power higher," say William Blair analysts Sebastien Naji and Ana Bilbao, who started SKHY stock at Outperform. "We estimate free cash flow will more than double to $239 billion by 2028 (after increasing more than 6 times this year), much of which we believe may be returned to shareholders."

Naji and Bilbao note that SK Hynix pioneered HBM, partnering with Advanced Micro Devices (AMD) as more than a decade ago to develop standards. "This, alongside its differentiated manufacturing approach (MR-MUF), good yield management, and a tight relationship with Nvidia (NVDA), has enabled it to capture the majority of the HBM market (holding 56% of share in the first quarter)," they add.

They note several potential risks to SK Hynix's earnings power, including increasing competition in HBM, greater competition from Chinese manufacturers in traditional DRAM and NAND markets, and negative pricing pressure as additional supply comes on line. Still, they see shares reaching $260 over the next 12 months, which would represent a rise of more than 80%.

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Wedbush analyst Matt Bryson issued an Outperform rating on SK Hynix's South Korean-traded shares, looking for a price target of 2,560,000.00 South Korean won that implies more than 60% upside from its closing price of 1,577,000.00 won.

He's generally bullish on memory names as a whole, believing vendor forecasts will keep moving higher at least until "substantial new production capacity comes online" if not longer. "The severity of undersupply is unique, with even server vendors despeccing products (due to lack of supply) and no apparent customer inventory builds (even many quarters into the upcycle)," he says.

Bryson likes Hynix's competitive technology position, which is evidenced by its "sustained HBM shipment leadership, early introduction of 1c based designs, and dominance in QLC market share." But he says valuation is the most compelling reason to choose Hynix among other memory stocks.

"Our PT (which implies > 50% appreciation potential for the Korean entity and >20% for the ADR) is calculated using a ~5x multiple to 2027E EPS of KRW 491,915, plus net cash of KRW 97,433/share (as of 2Q26)," Bryson says. "While we have seen memory stocks trade at MSD multiples before, we view this valuation metric as a historic base valuation for peak cycle earnings. But with this cycle, we would argue numbers are still moving higher; the peak period will be elongated; and finally, SCAs likely will elongate strong cashflows even post peak."

All three analysts joined a budding bull camp in SK Hynix. According to data from S&P Global Market Intelligence, the company's U.S.-listed shares currently enjoy eight Buy-equivalent ratings versus just one Hold and no Buys. That's driven by their views for long-term (the next three to five years) annual earnings growth, which currently sit at a wild 84% on average. And right now, the average 12-month target of $233.75 per share implies 62% upside from Monday's close.

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