[Edaily Reporter kyoungeun kim ] On the 2nd, NH INVESTMENT & SECURITIES maintained its “Buy” rating on SK hynix(000660)and raised its target price from 3.2 million won to 4.1 million won. The firm forecasts that SK hynix will enter a re-rating phase, driven by expanding memory demand in the age of artificial intelligence (AI) and its American Depositary Receipt (ADR) listing.

Ryu Young-ho, an analyst at NH INVESTMENT & SECURITIES, stated, “The company is preparing for the next-generation memory era based on its technology-driven high-performance memory,” adding, “Strong memory demand in the AI era and changes in the industry structure are expected to lead to a re-rating of memory companies.”

The target price increase reflects adjustments for both exchange rates and earnings. The target price was calculated by comparing the three-year average return on equity (ROE) and cost of equity (COE), reflecting the stability of earnings resulting from an increased proportion of long-term contracts.

Analyst Ryu forecasts that the recent upward trend in memory prices will continue into the second half of the year and has revised upward the operating profit forecasts for 2026 and 2027 to 289.427 trillion won (a 513.1% year-over-year increase) and 470.407 trillion won (a 62.5% year-over-year increase), respectively. The forecast assumes that the average selling price (ASP) of DRAM will rise 25.3% year-over-year in 2027, while HBM prices will increase by 47.5% and NAND prices by 29.7%.

SK hynix(000660)is currently trading at a 12-month forward (12MF) price-to-earnings ratio (P/E) of 6.0x. Analyst Ryu noted that, by the same measure, Micron is trading at 7.9x and SanDisk at 12.6x.

The ADR listing also serves as an opportunity for a revaluation. Analyst Ryu explained, “The company recently formalized its ADR listing through a securities registration statement, involving a 2.5% new share issuance (17.79 million shares), with the listing scheduled for July 10,” adding, “This listing is expected to expand accessibility for overseas investors and lead to a revaluation of the company’s value.” He added that the new funds raised through the ADR issuance are scheduled to be invested in facility expansion, and that the improved cash flow resulting from this fundraising is highly likely to be utilized as a source of funding for future shareholder returns.