Market: KOSPI (000660)
Brokerage : Mirae Asset Securities
Analyst : Younggun Kim
Investment Rating : BUY (Maintained)
Target Price : KRW 3,800,000 (Upgraded)
Core Momentum : Expanding LTAs and robust HBM demand are expected to sustain structurally high ROE and earnings growth, while the widening valuation gap with global memory peers creates room for further multiple re-rating.
📊 1. [Valuation & Key Financial Metrics]
- Equity Research Date: May 27, 2026
- Investment Rating: BUY (Maintained) / Target Price: KRW 3,800,000 (Upgraded)
- Current Price (as of 26/5/26): KRW 2,052,000 / Upside Potential: 85.2%
- Operating Profit (26F, KRW bn): 289,785 / Consensus Operating Profit (26F, KRW bn): 255,868
- EPS Growth (26F, %): 515.9 / MKT EPS Growth (26F, %): 238.0
- P/E (26F, x): 5.7 / MKT P/E (26F, x): 8.6 / KOSPI: 8,047.51
- Market Capitalization (KRW bn): 1,462,465 / Shares Outstanding (mn shares): 713 / Float Ratio (%): 74.9
- Foreign Ownership (%): 51.6 / Beta (12M) Daily Return: 1.70
- 52-Week Low / High (KRW): 202,500 / 2,052,000
- FY 2026F Estimates: Revenue KRW 366,486 bn, Operating Profit KRW 289,785 bn, Net Income KRW 259,389 bn, EPS KRW 363,107, ROE 103.1%, P/E 5.7x, P/B 3.8x, Dividend Yield 0.2%
- FY 2027F Estimates: Revenue KRW 530,534 bn, Operating Profit KRW 420,470 bn, Net Income KRW 362,688 bn, EPS KRW 508,892, ROE 64.5%, P/E 4.0x, P/B 2.0x, Dividend Yield 0.4%
🚀 2. [Market Opportunities & Business Outlook]
- The target price has been raised by 18.8% to KRW 3.8 million in alignment with a broader global memory sector valuation re-rating, lifting the applied P/B multiple from 5.3x to 6.2x (based on the current peer average of MU and Kioxia).
- The company’s 12-month forward P/B and P/E stand at 3.0x and 5.6x respectively, significantly lagging behind peer averages (6.2x and 10.1x), while higher memory price levels and expanding LTA proportions are projected to drive an average ROE of 66% for 2026–2028.
- As big tech data center order backlogs outpace Capex growth, memory LTA contracts are expanding, with SanDisk securing a massive $42B order backlog and favorable contract terms including a 25% advance payment ratio.
- For 2027, robust HBM demand expansion and customer diversification are anticipated, driven by Alphabet’s new TPU v8, Amazon’s Trainium3 and Trainium4, alongside the upcoming commercial rollout of NVIDIA’s Rubin featuring HBM4.
- Operating profits for 2Q26F, 26F, and 27F are estimated at KRW 67 trillion, KRW 290 trillion, and KRW 420 trillion respectively, meaning forward valuation multiples will compress further due to expected earnings growth next year, creating potential for new valuation baselines in the second half.
📝 Editor’s Comment (Perspective & Thesis Verification)
The analyst evaluates SK hynix as an undervalued enterprise within the broader global memory sector re-rating trend, highlighting its structural high-ROE profile driven by expanding long-term agreements (LTAs) and robust HBM demand momentum.
To determine whether this investment thesis is actively unfolding, key monitoring items include tracking the expansion of LTA execution and its stabilizing effect on earnings, alongside verifying whether 2027 HBM customer diversification and new product rollouts (such as Rubin) meet projected earnings contributions. These developments can be tracked through corporate earnings releases, official IR materials, and regulatory filings.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
Contact: Compliance and Copyright Inquiries (ksb220805@gmail.com)
