Market: KOSPI (000660)
Brokerage : Kiwoom Securities
Analyst : Yuak Park
Investment Rating : BUY (Maintain)
Target Price : 880,000 KRW (Raised)
Core Momentum : Sharp NAND price increases and higher fab utilization are expected to drive a substantial recovery in NAND profitability, while tight commodity DRAM supply strengthens overall pricing power and supports significant earnings upgrades.
📊 1. [Valuation & Key Financial Metrics]
- Target Price: 880,000 KRW (Raised)
- Investment Rating: BUY (Maintain)
- 2026F Financial Outlook: Revenue 163.2 trillion KRW, Operating Profit 102.9 trillion KRW (~103 trillion KRW), Net Income 85.136 trillion KRW
- EPS: 116,896 KRW (2026F)
- Valuation Multiples: PER 6.2x, PBR 2.6x, EV/EBITDA 0.8x, ROE 53.7% (Based on 2026F)
🚀 2. [Market Opportunities & Business Outlook]
- Upgraded Operating Profit Forecast: The 2026 operating profit forecast is revised upward to 103 trillion KRW. The 2026 blended ASP growth outlook for NAND is hiked from +14% to +50% YoY, and NAND operating profit is drastically revised from 3.5 trillion KRW to 13.0 trillion KRW (+1,068% YoY).
- Divisional Breakdown: Operating profit for 2026 is projected at 90.0 trillion KRW for DRAM (+106% YoY) and 13.0 trillion KRW for NAND (+1,068% YoY). HBM4 sales will ramp up starting 2Q26, while tight generic DRAM supply will favorably influence HBM pricing negotiations.
- NAND Market Improvement: Following 4Q25 wafer price surges, major module prices (eSSD, UFS) in 1Q26 are expected to jump +25~35% QoQ, with further upside potential due to limited supply growth in the first half. Cost structures are also set to improve as NAND fab utilization rates rise.
- Supply & Pricing Environment: Generic DRAM recovery is driven by low channel inventories, reduced DDR5 supply, and improved server DRAM demand. Set makers absorbing cost burdens via retail price hikes create an advantageous pricing negotiation environment.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix as achieving record-breaking earnings expansion—targeting 103 trillion KRW in annual operating profit for 2026—propelled by tight generic DRAM supply, NAND market improvements, and profitability enhancements driven by higher pricing and fab utilization rates. The analyst emphasizes the surging earnings momentum within the NAND sector.
To verify this investment thesis, one should track whether actual NAND and generic DRAM price increases match projections, if higher fab utilization rates successfully reduce NAND unit costs, and how HBM4 commercialization and set-demand trends impact pricing power. These indicators can be monitored through upcoming quarterly reports and regulatory filings via DART.
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