Key Takeaways
- SK hynix rose 5% today, with Sandisk up 6% and Micron up 3%, as memory and chip stocks bounced back from last week’s sell-off.
- The sell-off looks overdone, and SK hynix’s forward P/E is still well below its June peak.
- The bounce makes up only part of SK hynix’s 15% five-day drop in Seoul, its biggest weekly fall since 2008.
- The China worry hasn’t gone away: CXMT forecast up to $19.8 billion in nine-month net income, and SK hynix reports its third quarter next week.
SK hynix (SKHY) is up 5% today as memory and chip stocks bounce back together from last week’s sell-off.
Sandisk (SNDK) is up 6%, Micron (MU) is up 3%…AI networking and optical stocks are soaring too. The AI trade is back! At least for today.
Only part of the way back
Before the bounce in the US, SK hynix fell another 2% in Seoul on Monday. That took its five-day drop to 15%, the stock’s biggest weekly fall since the 2008 financial crisis.
A China DRAM scare set off the slide. ChangXin Memory Technologies (CXMT) claimed progress on a denser DRAM design and said it plans to have a server memory module by the end of 2026. Then on Sunday, it forecast up to $19.8 billion in net income for the first nine months of 2026, a swing from a loss a year earlier.
(A low multiple on a memory maker can also mean investors expect earnings to peak. Wall Street’s estimates still see SK hynix’s revenue peaking within the next few years.)
The China question is still open
Nothing in today’s rally settles how much market share CXMT can take. Its server module is still only a plan. But nearly $20 billion of profit in nine months gives it plenty of money to compete with.
My take: A 15% drop in a week looks like too much, too fast, over a rival whose server memory is still a year-end goal. With the multiple already well off its highs, I think the market has priced in a lot of the China risk, and I’d lean toward buying this dip.
Of course, SK hynix’s third-quarter report next week will tell us far more about memory demand than one good day of trading.
So what is SK hynix stock actually worth?
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
