Investing.com – UBS initiated coverage on SK Hynix Inc. () with a buy rating and a price target of $204.00, according to a report released Wednesday.
The investment bank set the price target as the stock trades 13% below its offering price of $149. SK Hynix shares are down 33% from their July 14 peak, with the stock currently at $126.79, hovering just above its 52-week low of $124.80.
UBS said the current valuation discounts a long-term return on equity of 17.7%, in line with the post-DRAM consolidation average from 2012 to 2022. The firm estimates SK Hynix will achieve an average ROE of 40.2% from 2027 to 2031.
The firm expects agentic AI to boost memory bit demand growth into 2027, with DRAM bit demand growth rising to 36% year-over-year from 22% in 2026. NAND demand is projected to increase to 23% from 20%.
UBS said the initiation complements its coverage of SK Hynix’s local listing on the Korea Exchange under ticker . The local shares have fallen 52% from their June 22 peak. According to InvestingPro, which tracks 16+ additional tips for SK Hynix, the stock is trading near its 52-week low despite impressive gross profit margins of 68%. Investors can access comprehensive analysis through Pro Research Reports, available for SK Hynix and 1,400+ other US equities.
In other recent news, SK hynix reported record-breaking financial results for the second quarter of 2026. The company achieved an all-time high revenue of KRW 79.3 trillion, marking a 51% increase from the previous quarter and a 257% rise from the same period last year. Operating income also reached a record KRW 60.5 trillion. SK hynix attributed this surge to high demand from AI infrastructure and tight supply conditions, which led to significant increases in DRAM and NAND prices.
Meanwhile, the South Korean finance ministry announced measures to regulate single-stock leveraged exchange-traded funds. The new regulations include a cap on investments and increased trading costs for these financial products. The government will maintain a 24-hour stock market monitoring system and plans to establish legal grounds for emergency market stabilizing measures. These developments reflect a broader effort to stabilize the financial market and manage investment risks.
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