SK Hynix draws bullish call from SemiAnalysis with 45% DRAM ASP forecast

A research firm's prediction that SK Hynix's DRAM prices will surge 45% this quarter has set up a high-stakes clash with local brokerages, after the stock plunged 33% from its June peak on profit concerns.

"SK Hynix and other top memory names offer the most attractive risk-reward in semiconductors, especially after this pullback," Ray Wang, an analyst at SemiAnalysis, said in a report titled "Be Greedy When Others Are Fearful."

SemiAnalysis projects SK Hynix will report DRAM operating profit of about 55 trillion won for the second quarter, with blended ASPs rising 45% quarter over quarter. That contrasts with KIS's estimate of 60.4 trillion won in total operating profit — about 8% below the market consensus of 65 trillion won — which triggered a more than 10% single-day selloff on July 13.

The divergence hinges on how much of SK Hynix's high-bandwidth memory revenue is locked into long-term supply agreements that cap near-term pricing flexibility. If SemiAnalysis is correct, the stock's 33% correction represents a buying opportunity in a memory market projected to grow from $171 billion in 2025 to $448 billion by 2034, according to Fortune Business Insights.

HBM Contracts vs. Spot Market: The Core Disagreement

KIS, a unit of Korea Investment & Securities, lowered its 2026 and 2027 operating profit forecasts by about 9% and 11%, respectively, attributing the revision to HBM long-term agreement pricing assumptions rather than any deterioration in business fundamentals. The brokerage maintained its 380,000 won target price and buy rating.

"HBM accounts for a large share of SK Hynix's revenue, and those long-term contracts lock in prices that can't be adjusted upward as quickly as spot market rates," KIS said in its report. The firm estimated second-quarter DRAM ASPs rose about 30% quarter over quarter and NAND ASPs about 50%, but said the blended figure was held back by HBM's contract structure.

SemiAnalysis counters that DRAM spot prices have surged roughly 60% quarter over quarter, more than enough to offset any HBM contract drag. The firm sees HBM pricing as stable with only low single-digit quarterly changes — not a headwind.

Record Margins and the Structural Shift

Both firms agree on one thing: SK Hynix's profitability is reaching historic levels. KIS expects second-quarter operating margins to hit 74.6%, an all-time high, with sequential improvement in each subsequent quarter. The brokerage argues that as the memory industry shifts toward three-to-five-year contract structures, valuation drivers will move from single-quarter ASP swings to the durability of high earnings.

SK Hynix shares closed at about 1.95 million won on July 14, down more than 10% from the prior session and 33% below the record high set on June 25. The stock's U.S.-listed shares, which debuted on American exchanges through a recent IPO, have tracked the decline.

For investors, the conflicting forecasts create a binary outcome. If SemiAnalysis's 45% DRAM ASP growth materializes, the stock could rebound sharply from oversold levels. If KIS's more conservative HBM pricing model proves accurate, further downside is possible as the market reprices earnings expectations. SK Hynix trades at roughly 8 times forward earnings based on KIS's revised estimates, compared with Micron Technology at about 10 times.

This article is for informational purposes only and does not constitute investment advice.