Is Now the Right Time to Buy SK Hynix?

As of the previous day, the stock price has fallen 21% since February 17... "Buy strategy continues" ahead of business recovery

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[Asia Economy Reporter Kum Boryeong] Although SK Hynix's stock price, once plummeted, has struggled to recover, there is an analysis that it should rather be seen as a buying opportunity.

According to the Korea Exchange on the 5th, SK Hynix's stock price closed at 83,200 KRW the previous day. Considering the closing price was 105,000 KRW on February 17, it has fallen by 20.76% during this period. This is in stark contrast to the KOSPI index, which rose 5.14% from 2,242.17 to 2,357.32 during the same period.

During this time, the stock price showed a downward trend rather than recovering. The stock price, which had consistently stayed in the 80,000 KRW range, dropped to 71,800 KRW on August 20 as the third-quarter business outlook was expected to be poor. At that time, there was an ongoing price negotiation struggle between server companies and manufacturers.

However, memory semiconductor demand, which passed the low points in July and August, showed signs of recovery from September, and from September 14, the stock price re-entered the 80,000 KRW range. Looking at the third-quarter performance, operating profit was 1.3 trillion KRW, and sales were 8.1 trillion KRW, which were relatively good. Compared to the previous quarter, these decreased by 33.2% and 5.6%, respectively, but generally met consensus expectations.

The news that shook the stock price again was SK Hynix's acquisition of Intel's NAND business division. Concerns arose in the market that the investment amount, reaching 10.3 trillion KRW, could negatively affect financial soundness, leading to a correction period in the stock price. The closing price on the 2nd was 79,600 KRW. SK Hynix plans to cover half of the acquisition funds with existing cash holdings and future cash flows, while considering borrowing and asset securitization for the remainder.

Brokerages analyze that it is time to buy SK Hynix ahead of the business recovery. Song Myungseop, a researcher at Hi Investment & Securities, explained, "Currently, signs of easing in the business downturn are already occurring in the fourth quarter, and with demand recovery and customer inventory reduction, the business is expected to begin a full recovery in the first half of next year," adding, "We recommend continuing a buying strategy for SK Hynix shares targeting this." Hwang Goun, a researcher at KB Securities, also said, "We see the fourth quarter as an opportunity to increase SK Hynix's weighting."

Most brokerages set SK Hynix's target stock price above 100,000 KRW. Samsung Securities and KB Securities set it at 120,000 KRW each, Hanwha Investment & Securities and KB Securities at 110,000 KRW each, and Eugene Investment & Securities at 105,000 KRW, judging that SK Hynix has sufficient potential for stock price growth.

This content was produced with the assistance of AI translation services.