[Edaily Reporter Park Jung-Soo ] Expectations for a stock price rebound are growing as SK hynix(000660)has announced a shareholder return plan to buy back 40 trillion won worth of its own shares and cancel them in their entirety. In particular, the company announced it would return more than 50% of its cumulative free cash flow (FCF) from 2025 to 2027 to shareholders, leading securities analysts to view this move as a signal for a stock price rebound. However, some analysts are taking a cautious stance, arguing that rather than assuming a stock price rise based solely on this measure, it is necessary to also assess the sustainability of future profits, the burden of capital expenditures, and the scale of additional shareholder returns.

◇ Entire 40 Trillion Won Treasury Stock to Be Canceled… “50% or More” of FCF
According to the Financial Supervisory Service’s electronic disclosure system on the 20th, SK hynix held a board meeting the previous day and resolved to purchase 40 trillion won worth of treasury stock on the open market and cancel the entire amount. The planned acquisition consists of 24.07 million shares, representing 3.3% of the issued shares, and the acquisition period runs from today through November 19. The company plans to cancel all of these shares once the acquisition is complete.
The market is also paying close attention to changes in the company’s shareholder return policy alongside this 40 trillion won share buyback and cancellation.
SK hynix announced that it will return at least 50% of its cumulative free cash flow (FCF) from 2025 to 2027 to shareholders. This effectively raises the minimum return threshold from the previous 50% level. The company plans to combine share buybacks and cancellations with cash dividends and is also considering measures to expand both regular and special dividends. Specific details regarding the scale and methods of additional returns are scheduled to be disclosed during the third-quarter earnings announcement.
Hana Securities assessed that raising the shareholder return benchmark from 50% of FCF to “50% or more” is significant. Kim Rok-ho, an analyst at Hana Securities, emphasized, “In particular, this 40 trillion won share buyback and cancellation is intended for full cancellation, unrelated to securing employee bonuses,” adding, “We had anticipated a share buyback in the range of 20 trillion to 30 trillion won, so this larger-than-expected scale is positive from the shareholders’ perspective.”
The firm also expects the company’s capacity for future shareholder returns to expand significantly. HANWHA INVESTMENT & SECURITIES estimated SK hynix’s cumulative FCF for 2025–2027 at approximately 491 trillion won (28.8 trillion won in 2025, 191.6 trillion won in 2026, and 270.6 trillion won in 2027). Even applying a minimum return rate of 50%, the total funds available for shareholder returns are calculated to be over 245 trillion won. The firm assessed that this 40 trillion won represents a preemptive allocation of a portion of future return funds.
◇ “40 Trillion Won Is Just the Beginning”… Expectations for a Catalyst to Rebound Stock Prices
Securities firms generally believe this measure will have a positive impact on the stock price and earnings per share (EPS).
HANWHA INVESTMENT & SECURITIES estimated on the 19th that if the entire 40 trillion won were canceled based on the closing price of 1.5 million won, earnings per share (EPS) would rise by approximately 3.8%. Park Jun-young, an analyst at HANWHA INVESTMENT & SECURITIES, analyzed, “Based on our estimates, even if only about half of the approximately 245 trillion won in return funds available during the policy period were used for share buybacks and cancellations, the cumulative amount could exceed 120 trillion won,” adding, “Additional share buybacks will lead to a sustained reduction in the number of shares outstanding and an increase in value per share.”
IBK Investment & Securities assessed that since the daily purchase order limit (10% of the reported acquisition shares) is 2,407,000 shares—equivalent to 42% of the average trading volume over the past month—this could also have a positive impact on actual supply and demand conditions.
Meritz Securities noted that this announcement came earlier than the originally planned third-quarter timeline and that the company also foreshadowed an additional dividend policy at the end of October. Kim Seon-woo, an analyst at Meritz Securities, stated, “Investors had been disappointed because no measures to boost the stock price were announced during earnings calls throughout the stock price correction period that began in July,” and predicted, “The company will drive the stock price higher by completing the share buyback in a concentrated manner within the three-month period specified in this announcement.”
◇ Investment Burden and Profit Sustainability Must Be Verified
Some analysts point out that even if shareholder returns positively impact market supply and demand, sustained earnings are necessary to drive a stock price revaluation. This is because the core debate in the market currently centers on how long the unprecedented profits generated by the AI cycle will last. As the pace of DRAM price increases slows and stock prices undergo a correction, doubts are growing about whether these profits can be sustained over the long term.
Lee Jong-wook, an analyst at SamsungSecurities, noted, “The narrative driving stock prices in the first half of this year was fueled by the excitement surrounding steep DRAM price hikes and earnings surprises.” He added, “However, following the stock price correction, the narrative is shifting toward the sustainability of profits. The key driver for stock prices now is a predictable trend of profit growth that lasts for at least one year.”
The burden of large-scale investments is also a variable. Analyst Kim Rok-ho noted, “The company has stated that it needs to secure more than 100 trillion won in cash to support future investments and maintain financial soundness,” adding, “As the scale of recent investments has been increasing, it is expected that securing additional cash will be necessary. It is estimated that the company will secure cash and cash equivalents equivalent to approximately two years’ worth of capital expenditures (CAPEX).”