[Edaily Reporter Shin Ha-yeon ] On the 22nd, HANWHA INVESTMENT & SECURITIES raised its target price for SK hynix(000660)from 1.63 million won to 4.30 million won, noting that earnings volatility has significantly decreased due to high-bandwidth memory (HBM) and long-term supply agreements (LTAs). The firm maintained its “Buy” investment rating.

Park Jun-young, an analyst at HANWHA INVESTMENT & SECURITIES, stated, “The company is transforming from one that exhibits extreme earnings volatility into one capable of consistently generating high levels of profit,” adding, “It does not need to be unjustifiably undervalued within the global tech sector.”

Analyst Park pointed out, “Among global semiconductor stocks, there are virtually no companies with a price-to-earnings ratio (PER) based on 2026 earnings estimates or a 12-month forward PER below 10 times.” He noted, “Even Micron, which operates in the same business, is already trading at a forward PER of over 10 times, whereas SK hynix’s 12-month forward PER is only 6.6 times.”

He further emphasized, “Korean memory companies are expected to generate industry-leading profits in 2026–2027, and earnings volatility is also improving significantly,” adding, “Even if a period of declining profits arrives in the future, we will not see operating profits plummet as they did in the past.”

HANWHA INVESTMENT & SECURITIES cited earnings volatility as the reason the memory sector has historically been valued at a discount. However, the firm assesses that the market structure itself has now changed.

Researcher Park predicted, “South Korea’s memory industry is overcoming these weaknesses by leveraging powerful tools such as LTAs and HBM,” adding, “Even if the memory industry enters a period of profit decline in the future, we are unlikely to see operating profits drop drastically year-over-year.”

In particular, the expansion of long-term supply agreements (LTAs) was identified as a key factor in enhancing profit stability. Analyst Park analyzed, “The LTAs currently being actively signed include both mechanisms to protect against a downturn in memory prices and legal safeguards to ensure contract fulfillment,” adding, “Unlike in past downturns, when operating profit margins fell below 10% or the industry recorded losses, future downturns will guarantee an operating profit margin of at least 30%.”

The expansion of the HBM business was also viewed positively. He explained, “HBM is currently estimated to account for around 20% of operating profit and is expected to continue growing over the medium to long term,” adding, “HBM is a product that exhibits much more stable price trends compared to general-purpose memory, serving as a crucial mechanism to ensure profit sustainability.”

A listing on the U.S. stock market was also cited as an additional factor for revaluation. Analyst Park noted, “The company is aiming to list American Depositary Receipts (ADRs) within the year,” adding, “The opportunity to be evaluated alongside comparable companies on the U.S. stock market is drawing near.”

He further assessed, “Given its overwhelmingly attractive valuation and technological edge over peers, the ADR listing will be a prime opportunity for the company to be revalued once again,” adding, “The company is currently the best investment Daesang in terms of both fundamentals and momentum.”