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Photo = SK hynix |
[Alpha Biz= Reporter Kim Sangjin] On the 12th, Korea Investment & Securities reduced its target price for SK Hynix by 14% to KRW 250,000, citing that the company's Q3 performance is expected to fall short of market consensus. The firm forecasts SK Hynix to report Q3 revenues of KRW 17.8 trillion and operating profit of KRW 6.9 trillion. While this operating profit exceeds the previous record high of KRW 6.5 trillion from Q3 2018, it is 2% below the consensus estimate of KRW 7.1 trillion.
Despite concerns about a potential decline in DRAM average selling prices (ASP) in Q4, Korea Investment & Securities notes that customer inventories outside of mobile are healthy and that DDR5 and HBM remain in supply shortage. The firm expects that after the short-term adjustment of mobile inventory, supply and demand will balance, leading to stabilization of ASP and performance. They believe that stock price gains will be most significant following this adjustment.
Korea Investment & Securities maintains a "Buy" recommendation for SK Hynix, considering the stock's excessive correction, and continues to recommend it as a top pick in the sector.
AlphaBIZ Kim SangJin(letyou@alphabiz.co.kr)
