SK Hynix Trades at a Premium to Samsung for the First Time, But a 5% Slide Shows the Market Isn't Buying It Yet

The math is almost absurd. SK Hynix now commands a forward P/E of 6.79, surpassing Samsung Electronics’ multiple for the first time in history. The smaller, specialized memory maker is no longer valued like a cyclical commodity play — investors are pricing it as a structural winner in the artificial-intelligence arms race. Yet on Tuesday, the shares tumbled 5.16% to close at 1,745,000 won, erasing a chunk of a year-to-date rally that still stands at roughly 158%.

That contradiction — record operating performance clashing with sudden profit-taking — captures the moment for SK Hynix. The company is simultaneously executing a physical and strategic reorganisation, moving its Seoul offices into the SK Seorin Building, the group's headquarters where Chairman Chey Tae-won plans to exert more direct control over the semiconductor business. Insiders say new security protocols are being drawn up to protect sensitive customer data from AI partners such as Nvidia at the unified site.

Operationally, the numbers are headline-grabbing. In the first quarter of 2026, SK Hynix booked revenue of around 52.6 trillion won and operating profit of 37.6 trillion won — a fivefold year-on-year jump. The high-bandwidth memory (HBM) division alone runs an operating margin of approximately 72%, a figure that even surpasses Nvidia's. Analysts are calling it a "triple memory super cycle" as demand for DRAM, HBM and high-capacity SSDs surges simultaneously.

Should investors sell immediately? Or is it worth buying SK Hynix?

That performance has triggered a wave of target-price increases from major investment banks. Nomura Securities lifted its target to 4 million won, arguing the stock is massively undervalued. JPMorgan raised its target to 3 million won, switching its valuation methodology from book value to price-to-earnings, a tacit acknowledgment the old cyclical lens is obsolete. UBS set a new target of 1.7 million won, citing a historic super cycle. The common thread: long-term supply contracts are stabilising an industry traditionally prone to boom-and-bust, justifying higher multiples.

The supply squeeze is real. SK Hynix's HBM production capacity is sold out through 2026, and cloud hyperscalers have reportedly offered to co-finance new factories and even purchase expensive ASML lithography machines outright. Management has so far declined, wary of becoming too dependent on single customers. Instead, the company is funding its expansion internally. The M15X fab in Cheongju is set to begin mass production in November 2026, while the next-generation HBM4E chips are slated for serial production in 2027. The group also plans to introduce the most advanced High-NA EUV lithography equipment from ASML for upcoming chip generations. Meanwhile, a possible listing of American Depositary Shares (ADS) in the US is under review, following a similar move by rival Kioxia.

Yet for all the bullish noise, Tuesday's sell-off was broad-based. Foreign investors yanked capital out of the KOSPI, while US Treasury yields hovered at 4.6% and oil breached $100 a barrel after fresh geopolitical tensions in the Middle East. Macro fears have temporarily overshadowed micro fundamentals. Short-term traders booked profits, and the stock will trade ex-dividend on May 28, with a payout of 375 won per share.

Risk warnings are also starting to accumulate. The Wall Street Journal has flagged the possibility of a bubble in AI memory chips, cautioning that if manufacturers expand capacity too aggressively, a supply glut could emerge. UBS analysts project that Samsung will close the market-share gap by 2027. For now, though, SK Hynix enjoys an enviable position: every fab is full, every customer is hungry, and the group is quietly tightening its corporate structure to keep the AI flywheel spinning under a single roof.

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SK Hynix Stock: New Analysis - 19 May

Fresh SK Hynix information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

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