"1.7 million? It could go to 3.1 million"... Foreign investors call for a full buy on SK hynix

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[Financial News] Citigroup Global Markets Securities has sharply raised its target prices for Samsung Electronics and SK hynix, reflecting a clear improvement in the memory semiconductor industry. The firm said strong momentum in memory prices is likely to continue in the second half, supported by surging demand for artificial intelligence and the adoption of next-generation memory.
According to the financial investment industry on the 13th, Citigroup Global Markets Korea Securities Limited recently raised its target price for Samsung Electronics from 300,000 won to 450,000 won, and for SK hynix from 1.7 million won to 3.1 million won. It kept its investment rating of "buy" for both companies.
The main reason for the upgrade was the continued rise in memory semiconductor prices, which is expected to hold up in the second half as well. Citigroup Global Markets Securities forecast that the average selling price of High Bandwidth Memory (HBM) will jump by about 30% quarter on quarter in the fourth quarter of this year.
In particular, it said the overall memory market will be driven sharply higher by Anthropic's move to expand token limits for its AI chatbot Claude, along with the full-scale adoption of SOCAMM2, a next-generation memory module.
As a result, expectations for the performance of general-purpose memory products have also risen further. The report projected that the average selling prices of Dynamic Random Access Memory (DRAM) and NAND flash memory in the second half of this year will rise 200% and 186%, respectively, from a year earlier.
That is well above the previous forecasts of 190% and 172%. The outlook for growth in solid-state drive (SSD) sales was also raised to 267% from 242%.
Citigroup Global Markets Securities was especially upbeat about SK hynix's additional upside potential. The report said, "As the benefits from HBM mix and stronger general-purpose memory prices from Anthropic's higher token limits continue at the same time, the scale of earnings improvement could exceed market expectations."
It added, "As prices for 64GB DDR5 RDIMM used in main servers continue to rise, the full-scale adoption of SOCAMM2 is likely to have a positive effect on overall mobile DRAM prices."
Meanwhile, RDIMM is a high-performance memory module for servers and workstations optimized for processing large volumes of data by adding a register, or buffer chip, inside the module to relay signals between the memory controller and DRAM chips.
moon@fnnews.com Moon Young-jin Reporter