A $28.7 Billion Reason to Buy SK hynix Stock Now
Record Q2 results, HBM4 shipments, substantial net cash and a major share cancellation support SK hynix’s AI-growth thesis, although analysts expect steep FY2026 EPS declines before recovery in FY2027.
SK hynix (SKHY) is benefiting from accelerating artificial-intelligence infrastructure spending, which is driving demand for dynamic random-access memory (DRAM), high-bandwidth memory (HBM), NAND flash, enterprise solid-state drives (SSDs) and multi-chip packages (MCPs). On Aug. 19, the South Korean company’s Board approved a ₩40 trillion ($28.69 billion) share buyback, the largest buyback-and-cancellation program by a South Korean listed company. Based on the prior closing price of ₩1,662,000 ($1,192.13), the program could cover about 24.07 million shares, or 3.3% of its 730,492,365 shares outstanding. The buyback began Aug. 20 and will run for three months, after which all repurchased shares will be permanently canceled, potentially increasing earnings per share. Headquartered in Icheon-si, South Korea, SK hynix also provides foundry services for non-memory semiconductors and serves data-center, networking, mobile, PC, consumer-electronics and automotive customers. Its market capitalization is $1.14 trillion. The company began regular Nasdaq trading under SKHY on July 13, following temporary when-issued trading under SKHYV on July 10. The stock gained 7.8% over the past month but declined 1.64% over the previous five trading sessions. It trades at approximately 3.12 times forward sales, below the industry average of 3.39 times. Q2 2026 revenue reached ₩79.3 trillion ($56.9 billion), up 256.8% year over year. Operating profit rose 557.2% to ₩60.5 trillion ($43.4 billion), while net income increased 1,242.5% to ₩93.9 trillion ($67.4 billion), marking the company’s strongest quarterly results. AI-server DRAM, HBM and enterprise-SSD demand, combined with higher memory prices, drove the gains. SK hynix ended the quarter with ₩88 trillion ($63.12 billion) in cash and ₩18.6 trillion ($13.34 billion) in debt, producing net cash of ₩69.4 trillion ($49.78 billion). It has begun mass HBM4 shipments, plans faster production in the second half of 2026 and has long-term supply agreements with around 10 customers. The principal risk is near-term earnings volatility. Analysts forecast Q3 FY2026 EPS down 99.4% year over year to $5.97 and FY2026 EPS down 97.5% to $25.48, followed by a 27.4% recovery to $32.46 in FY2027. Among 15 analysts, 11 rate SKHY Strong Buy, two Moderate Buy and two Hold. The average price target is $245.40, implying 57.1% upside; the Street-high $320 target implies 104.9%.