Business · Companies · 4 hrs ago

Analyst raises SK Hynix’s next-year profit forecast to 464 trillion won

Analyst raises SK Hynix’s next-year profit forecast to 464 trillion won

Hana Securities raised its forecast for SK Hynix’s next-year operating profit to 464 trillion won, citing stronger memory prices and higher shipments of high-bandwidth memory, or HBM.

SK Hynix, based in Icheon, South Korea, makes memory chips used in computers and other devices.

The brokerage said the company’s third-quarter revenue topped 100 trillion won for the first time, helped by higher prices for DRAM and NAND chips and a shift toward higher-value products.

It expects production increases at the company’s M15X plant in Cheongju to support a rise in HBM4 shipments in the fourth quarter.

SK Hynix has outlined about 100 trillion won in planned shareholder returns, including share buybacks and cash dividends.

The brokerage said foreign-exchange and investment valuation losses weighed on third-quarter pre-tax and net profit, even as operating results beat its estimates.

It expects buybacks and share cancellations to continue each quarter, while investors will watch whether memory demand and prices support the higher earnings forecast.

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What people are saying

Kim Rok-hoHana Securities researcher
The company's revenue next year is expected to be 568 trillion won and operating profit 464 trillion won, increases of 56% and 64% year on year, respectively.
via Hankyung
The increase in memory prices was larger than expected, with DRAM up 29% and NAND flash up 26%.
via Hankyung
The reason fourth-quarter shipments are expected to be higher than expected is that HBM4 shipments will surge as increased production at the Cheongju M15X plant gets fully underway.
via Hankyung
If confidence in medium- to long-term earnings and shareholder-return policies builds, the valuation multiple is also likely to be reassessed.
via Hankyung