Global investment bank (IB) JPMorgan said the memory semiconductor industry will likely remain strong through 2027 on the back of data center and artificial intelligence (AI) computing demand.
According to the financial investment industry on the 25th, JPMorgan raised its outlook for the global memory semiconductor total addressable market (TAM) by up to 24% from previous estimates in a report.
JPMorgan expected high-bandwidth memory (HBM), a key component of AI chips, to account for 43% of the DRAM memory market by 2027. JPMorgan said that would reduce price volatility and help defend the downside for profitability.
JPMorgan also said NAND flash, which has seen a lack of investment over the past two years, is likely to see product prices trend higher as adoption of eSSD (enterprise solid-state drive) increases.
While memory semiconductor corporations' share prices have climbed sharply of late, JPMorgan stressed they should not be compared with past valuation levels. That is because profitability has structurally improved.
JPMorgan picked SK hynix as its top pick. It projected the company will maintain leadership in the next-generation HBM (HBM4) market as well. It also raised the SK hynix target price to 460,000 won.
JPMorgan then presented Samsung Electronics as its second-favorite pick. It also lifted the Samsung Electronics target price to 100,000 won.