KB Securities on the 10th projected that SK hynix's operating profit this year will rise 55% from a year earlier to 251 trillion won. It said the company is expected to enter No. 4 in the global operating profit rankings. It maintained an investment rating of Buy and raised its target price to 1.9 million won. SK hynix's closing price the previous day was 998,000 won.
KB Securities forecast that DRAM prices will climb 170% year over year this year and NAND flash prices 190%. Accordingly, it raised its operating profit estimates for this year and for 2027 to 251 trillion won and 358 trillion won, respectively. Those are increases of 42% and 55% from previous estimates, respectively.
Kim Dong-Won, head of research at KB Securities, said, "In particular, the pace of operating profit growth is expected to enter an acceleration phase starting in the first quarter," and explained, "For big tech, in the process of expanding artificial intelligence (AI) infrastructure investment over the coming years, stable procurement of memory semiconductors, a strategic asset, is being recognized not as an expense but as a condition for survival."
It also saw a high likelihood that the structural uptrend in memory prices will continue over the medium to long term.
Amid these conditions, it expected SK hynix's operating profit this year to exceed those of Microsoft and Google.
KB Securities' projected operating profit of 251 trillion won for SK hynix this year is above Microsoft, ranked No. 5 globally at 245 trillion won, and Alphabet, Google's parent company, ranked No. 6 at 240 trillion won.
Kim said, "SK hynix is expected to enter No. 4 in global operating profit rankings and cement a position in the world's top five," adding, "An annual operating profit of 251 trillion won corresponds to a monthly average of about 21 trillion won and a daily average of 700 billion won."
KB Securities estimated DRAM operating profit at 203 trillion won, up fivefold from a year earlier (operating margin 83%), and NAND operating profit at 47 trillion won, surging 23-fold (operating margin 62%).
Kim, the analyst, said, "With the memory industry pursuing long-term supply contracts through 2030, it is highly likely to evolve into a foundry-type model with a pre-order/post-production structure similar to TSMC, which is expected to be key to a valuation re-rating," and added, "Accordingly, SK hynix is expected to achieve operating profits of 251 trillion won this year and 358 trillion won in 2027, with its global operating profit ranking rising from No. 4 in 2026 to No. 3 in 2027."
In particular, it projected that in 2027, among the world's top 10 by operating profit, Samsung Electronics, a Korean memory chipmaker, will rank No. 1 and SK hynix No. 3.
KB Securities viewed SK hynix as undervalued. Kim said, "With a 12-month forward price-earnings ratio (PER) of only 3.1 times, SK hynix's market capitalization is just 38% of the average market cap of three global companies—Meta, JPMorgan, and TSMC—whose operating profits are half that of SK hynix, and only 20% of the global top-10 average market cap."
He added, "Accordingly, the valuation, which is significantly low relative to the scale of profit, suggests potential for a re-rating going forward."