Market: KOSPI (000660)
Brokerage : Kiwoom Securities
Analyst : Yuak Park
Investment Rating : BUY (Maintained)
Target Price : 730,000 KRW (Raised)
Core Momentum : Tight commodity DRAM supply and stronger server demand are expected to sustain price increases and sharply expand conventional DRAM margins, supporting earnings growth even through the seasonal first-quarter slowdown.
📊 1. [Valuation & Key Financial Metrics]
- Target Price: 730,000 KRW (Raised)
- Investment Rating: BUY (Maintained)
- 2026F Financial Outlook: Revenue 136.23 trillion KRW, Operating Profit 80.03 trillion KRW (~80 trillion KRW), Net Income 67.54 trillion KRW
- EPS: 92,775 KRW (2026F)
- Valuation Multiples: PER 6.1x, PBR 2.3x, EV/EBITDA 1.2x, ROE 45.5% (Based on 2026F)
🚀 2. [Market Opportunities & Business Outlook]
- 4Q25 Preview: Revenue is expected to reach 28.8 trillion KRW (+18% QoQ) and operating profit 15.0 trillion KRW (+32% QoQ), beating estimates and market consensus (FnGuide OP of 14.1 trillion KRW). Divisional operating profit is estimated at 14.1 trillion KRW for DRAM (+28% QoQ) and 0.9 trillion KRW for NAND (+171% QoQ).
- 2026 Full-Year Outlook: The 2026 financial outlook is revised upward to 136.2 trillion KRW in revenue (+46% YoY) and 80.0 trillion KRW in operating profit (+86% YoY). Even during the traditional off-season, 1Q26 operating profit is projected to reach 17.3 trillion KRW (+15% QoQ) on revenue of 30.2 trillion KRW (+5% QoQ), significantly beating the market consensus (FnGuide OP of 14.9 trillion KRW).
- Divisional Trends & Industry Dynamics: The operating profit contribution of generic products within SK hynix’s DRAM segment is projected to expand significantly from ~50% in 3Q25 to ~70% in 1Q26, with generic DRAM operating margins surging to ~70% in 1Q26 from ~50% in 3Q25. NAND, which successfully turned to a surplus in 3Q25, is also expected to drive profitability improvements centered on eSSD demand growth and price hikes.
- Pricing & Supply Environment: Generic DRAM recovery is driven by 1) low channel inventories, 2) reduced DDR5 supply due to DDR4 phase-outs, and 3) improved server DRAM demand, with the initial upcycle momentum exceeding expectations.
📝 Editor’s Comment (Perspective)
The analyst views SK hynix as entering an 80 trillion KRW operating profit era for full-year 2026, supported by upward revisions in generic memory pricing assumptions. The analyst highlights exceptional earnings resilience during the off-season 1Q and solidifies its status as a top pick in the semiconductor sector.
To verify this investment thesis, one should track whether actual 4Q25 and 1Q26 operating profits exceed 15.0 trillion KRW and 17.3 trillion KRW respectively to beat consensus, if generic DRAM’s profit contribution and margin expand to the projected 70% level in 1Q26, and whether price uptrends persist despite concerns over PC and smartphone demand slowdowns. These indicators can be monitored through upcoming quarterly reports and regulatory filings via DART.
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Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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