A $28.7 Billion Reason to Buy SK hynix Stock Now

A $28.7 Billion Reason to Buy SK hynix Stock Now

Aanchal Sugandh

Sat, August 22, 2026 at 6:00 PM GMT+3 5 min read

• SKHY +0.20%

SK hynix (SKHY) has emerged as a powerhouse in the global memory-chip industry, playing a central role in the artificial intelligence (AI) revolution. As data centers and AI infrastructure expand worldwide, demand for its dynamic random-access memory (DRAM) and NAND flash products is accelerating.

That momentum has translated into record earnings and helped the company maintain its leadership in high-performance AI memory. The South Korean memory-chip giant has also expanded its reach in U.S. markets, with its American Depositary Shares now trading on the Nasdaq.

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However, management appears to believe the stock still does not fully reflect the company's underlying value. On Wednesday, Aug. 19, SK hynix's Board approved a ₩40 trillion ($28.69 billion) share buyback, followed by the permanent cancellation of all repurchased shares.

This represents the largest buyback-and-cancellation program by a South Korean listed company. Based on the previous day's closing price of ₩1,662,000 ($1,192.13), the program could cover roughly 24.07 million shares, or about 3.3% of the company's 730,492,365 shares outstanding. The buyback begins Thursday, Aug. 20 and will run for three months.

For investors, the share cancellation could provide an additional boost by reducing the number of outstanding shares and increasing EPS. And with the accelerating AI demand, SK hynix has positioned itself to reward shareholders while investing in the next phase of growth.

About SK hynix Stock

Headquartered in Icheon-si, South Korea, SK hynix is one of the world's leading semiconductor manufacturers that develops and produces a wide range of memory solutions, including DRAM, NAND flash memory, solid-state drives (SSDs), and multi-chip packages (MCPs).

Holding a market cap of $1.14 trillion, it also provides foundry services for non-memory semiconductors, serving customers across data centers, networking, mobile devices, PCs, consumer electronics, and automotive applications.

The company recently expanded its presence in the U.S. capital markets. On Monday, July 13, SK hynix began regular trading on the Nasdaq under the ticker SKHY, following a record-breaking debut. Before the official listing, shares traded under the temporary when-issued ticker SKHYV on Friday, July 10.

Since then, the stock has maintained modest momentum, gaining 7.8% over the past month but losing 1.64% during the past five trading sessions.

From a valuation standpoint, SKHY stock is currently trading at approximately 3.12 times forward sales, below the industry average of 3.39 times. The premium valuation suggests investors have strong expectations for the company's future growth.

A Closer Look at SK hynix's Q2 Earnings

On July 29, SK hynix posted another exceptional quarter, sending its shares 17.52% higher in the following trading session. The company generated ₩79.3 trillion ($56.9 billion) in revenue during Q2 2026, representing a remarkable 256.8% increase from a year earlier.

Operating profit climbed 557.2% from the year-ago value to ₩60.5 trillion ($43.4 billion), while net income jumped 1,242.5% year-over-year (YOY) to ₩93.9 trillion ($67.4 billion). The figures marked SK hynix's strongest quarterly results in its history.

The growth was primarily driven by AI infrastructure spending. Demand for high-bandwidth memory (HBM), AI server DRAM, and enterprise SSDs remained exceptionally strong as data-center operators expanded their AI capabilities. Higher memory prices also helped SK hynix turn strong demand into even greater profits.

Now, the company is entering the next phase from a position of financial strength. It ended the quarter with ₩88 trillion ($63.12 billion) in cash and just ₩18.6 trillion ($13.34 billion) of debt, leaving it with a net cash position of ₩69.4 trillion ($49.78 billion).

That gives management room to invest in additional production capacity without putting excessive pressure on its balance sheet. SK hynix has also started mass shipments of HBM4 and plans to accelerate production during the second half of 2026.

Management expects AI adoption to spread across more industries and has already signed long-term supply agreements with around 10 customers. Nevertheless, analysts see a sharp near-term earnings decline before growth returns.

Q3 FY2026 EPS is forecasted to decrease 99.4% YOY to $5.97, while full-year FY2026 EPS could fall 97.5% from the previous year to $25.48. However, for FY2027, analysts expect EPS to recover 27.4% YOY to $32.46.

What Do Analysts Expect for SK hynix Stock?

SKHY stock has received an overall rating of "Strong Buy" from Wall Street. Among 15 analysts covering the name, 11 recommend a "Strong Buy," two advise a "Moderate Buy," while two suggest "Hold."

To that end, the average price target of $245.40 implies potential upside of 57.1%. Meanwhile, the Street-High target of $320 points to a possible gain of 104.9% from current levels.

On the date of publication, Aanchal Sugandh did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com