[Click eStock] "SK Hynix's 2025 Operating Profit Forecast Raised to 80 Trillion Won... Target Price Up"

Target Share Price Raised from 650,000 Won to 730,000 Won

On November 19, Kiwoom Securities raised its 2025 operating profit forecast for SK Hynix to 80 trillion won and increased its target share price from 650,000 won to 730,000 won. The investment opinion remains "Buy."

Park Yuak, an analyst at Kiwoom Securities, stated, "We have raised the target share price to reflect the revised earnings outlook for SK Hynix for 2026 to 2028. The general-purpose DRAM market is experiencing a recovery cycle centered on price increases, driven by lower distribution inventory, reduced DDR5 supply due to increased DDR4 production, and improved demand for server DRAM. The strength of this initial upcycle is also exceeding expectations. Recently, this positive momentum has been spreading to the NAND industry as well."

Kiwoom Securities has revised its outlook for SK Hynix's 2025 results, projecting sales of 136.2 trillion won and operating profit of 80 trillion won. This represents increases of 46% and 86%, respectively, compared to the same period last year. Park explained, "We have raised the price outlook for general-purpose memory products, and even in the seasonally weak first quarter of next year, sales are expected to rise by 5% quarter-on-quarter to 30.2 trillion won, with operating profit increasing by 15% to 17.3 trillion won, significantly exceeding market expectations. The proportion of operating profit from general-purpose DRAM products within SK Hynix's DRAM business is expected to expand sharply from around 50% in the third quarter of this year to about 70% in the first quarter of next year, and the operating margin for general-purpose DRAM is also expected to surge from around 50% to 70% during the same period." For NAND, which returned to profitability in the third quarter, increased demand for enterprise solid-state drives (eSSD) and rising product prices are expected to further improve profitability. Park forecasted, "SK Hynix's operating profit by business segment next year will be 75.1 trillion won for DRAM and 5 trillion won for NAND, up 78% and 400% year-on-year, respectively."

Fourth-quarter results this year are also expected to exceed market expectations. Park said, "In the fourth quarter, SK Hynix is expected to post sales of 28.8 trillion won, up 18% quarter-on-quarter, and operating profit of 15 trillion won, up 32%, surpassing the consensus (average securities firm forecast) of 14.1 trillion won in operating profit. We have also raised the forecast for fixed prices of general-purpose memory products from a 27% increase quarter-on-quarter to a 37% increase. As further price increases are possible in the fourth quarter, it is advisable to raise expectations for earnings even higher."