SK Hynix (000660) In-Depth Analysis — HBM4 Supply Competitiveness and Valuation Structure Review [2026.05]
SK Hynix (000660) is a global memory semiconductor company anchored in HBM, DRAM, and NAND. Having recorded Q1 2026 operating profit of 37.6조원 (≈$25.2B), its earnings momentum continues on an upward trajectory. The Forward PER of 6.0x reflects the current consensus outlook for EPS improvement. At the current share price of 1,840,000원 (≈$1,232), market capitalization stands at approximately 1,311조원 (≈$877.5B).
1. Company Overview and Core Business
SK Hynix (000660) is a global memory semiconductor company with DRAM, NAND flash, and High Bandwidth Memory (HBM) as its core products. Q1 2026 revenue was 52.6조원 (≈$35.2B), with operating profit of 37.6조원 (≈$25.2B) and an operating margin of 72%. Annual revenue is projected to grow from 97.1조원 (≈$65.0B) with operating profit of 47.2조원 (≈$31.6B) in 2025, to 322.6조원*1 (≈$215.9B) with operating profit of 248.5조원*1 (≈$166.3B) in 2026. Based on 712,702 thousand shares outstanding, the current price of KRW 1,840,000 (≈$1,231.6) implies a market capitalization of approximately 1,311조원 (≈$877.5B).
📌 FY2026 operating margin projected at 77%*1 — up 28 percentage points from 49% in 2025
2. Competitive Analysis of Core Products
The company is addressing AI infrastructure demand centered on HBM3E and HBM4, maintaining a leading position with approximately 50% supply share in the global HBM market*2. Samsung Electronics (approximately 40%*2) and Micron follow in a three-way competitive landscape. Q2 2026 DRAM ASP is projected at $1.57/Gb*1 (+43% vs. Q1), and NAND ASP at $0.27/GB*1 (+75% vs. Q1). The pilot line at the M15X fab in Yongin, Gyeonggi supports simultaneous production of HBM3E and HBM4, with Q2 segment operating profit expected at 52.8조원*1 (≈$35.3B) for DRAM and 17.2조원*1 (≈$11.5B) for NAND.
| Category | Details |
|---|---|
| Position | Global HBM supply share ~50% (Leader)*2 |
| Competitive Advantages | Early ramp of HBM4 mass production; M15X pilot line enables simultaneous HBM3E·HBM4 output |
| Competitive Disadvantages | Demand concentration risk from heavy reliance on select AI accelerator customers |
3. Valuation Analysis
Based on the current price of KRW 1,840,000 (≈$1,231.6), the Trailing PER of 31.2x is below the sector average of 83.6x*3. The Forward PER of 6.0x reflects significant valuation compression potential upon achieving the 2026 consensus EPS, which serves as the critical prerequisite. PBR of 10.54x falls within a justifiable premium range relative to profitability, given the projected 2026 ROE of 91.7%*1. Net debt ratio already turned net cash at -2.4% in 2025, and is projected to deepen further to -47.5%*1 in 2026.
📌 Forward PER 6.0x — Achievement of 2026 EPS consensus is the critical prerequisite
| Metric | Current | Sector Average | Interpretation |
|---|---|---|---|
| Trailing PER | 31.2x | 83.6x*3 | Below sector average |
| Forward PER | 6.0x | 41.3x*3 | High compression potential assuming EPS improvement |
| PBR | 10.54x | — | Profitability premium relative to ROE 91.7%*1 |
| Net Debt Ratio | -47.5%*1 (2026E) | — | Net cash structure expected to deepen |
4. Risks and Monitoring Points
The primary risks are demand concentration driven by exposure to specific AI accelerator customers, and the potential for a slowdown in commodity memory price increases from Q3 onwards*1. A delayed recovery in PC and smartphone demand may accelerate OEM inventory restocking, altering the trajectory of mobile DRAM pricing. Securing supply volume for new HBM4 customers is also a key variable for medium-term competitiveness.
- ⚠️ Demand concentration from exposure to specific AI accelerator customers
- ⚠️ Slowdown in commodity memory price increases from Q3 onwards*1 — monitoring of mobile DRAM and NAND module pricing trends required
- 📌 Quarterly DRAM ASP trend (2Q26E: $1.57/Gb, 3Q26E: $1.60/Gb*1)
- 📌 Changes in global HBM supply market share (monitoring of current ~50%*2 share maintenance)
5. Recent DART Filings
As of the analysis date (2026-05-18), no new DART filings with high relevance to this report were identified.
6. Key Changes Since Prior Analysis
Compared to the May 11, 2026 analysis, the share price rose 9.1%, from ₩1,686,000 (≈$1,129) to ₩1,840,000 (≈$1,232). Trailing PER improved from 31.9x to 31.2x, Forward PER from 7.0x to 6.0x, and PBR edged down from 10.77x to 10.54x. Kiwoom Securities raised its price target on SK Hynix from ₩1,300,000 (≈$870) to ₩1,900,000 (≈$1,272) and revised its investment rating from BUY to Outperform*4 over the same period. A research report was also published projecting Q2 operating profit of ₩70T (≈$46.9B), above the market consensus of ₩61T (≈$40.8B).
SK Hynix is positioned to benefit simultaneously from HBM-driven AI infrastructure demand and from the recovery in commodity memory prices. As the Forward PER of 6.0x may be reinterpreted depending on whether the 2026 EPS consensus is achieved, it remains essential to continuously track quarterly earnings trends and ASP movements.
📎 References & Estimation Basis
- *1 Estimates based on the Kiwoom Securities Research Center SK Hynix company update report dated May 11, 2026 (includes full-year and quarterly earnings forecasts for 2026, ROE, and net debt ratio)
- *2 Industry consensus estimates of HBM global supply market share (based on 2025–2026 data, including approximately 40% for Samsung Electronics)
- *3 Naver Finance sector-average Trailing PER and Forward PER (reference figures as of the prior analysis date)
- *4 Kiwoom Securities Research Center SK Hynix company update report dated May 11, 2026 — target price raised to 190만원 (≈$1,272) from 130만원 (≈$870), investment opinion revised to Outperform from BUY
- *5 USD equivalents (≈$) are approximate, calculated at 1 USD = 1,494 KRW (as of 2026-05-18, source: Yahoo Finance).
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