SK hynix: Cheap Despite A Historic Memory Boom

Yiannis Zourmpanos 17.95K Followers Follow Summary SK hynix delivered 257% revenue growth and 557% operating profit growth, while its operating margin reached a remarkable 76%. HBM4 entered mass production in Q2, while HBM4E follows in 2027, reinforcing SK hynix's technological lead. Approximately 10 customers have signed long-term agreements, often spanning five years with deposits and volume commitments supporting demand visibility. SK hynix ended Q2 with KRW69.4 trillion net cash, providing substantial capacity to fund its high-KRW40 trillion CapEx program. At roughly 4.4x forward sales, SK hynix trades below Micron despite HBM leadership, supporting a $200-$250 valuation range. Jonathan Kitchen/DigitalVision via Getty Images Investment Thesis I think the recent memory-stock correction has led to one of the most appealing opportunities in the AI semiconductor space. SK hynix ( SKHY ) is being valued as if the current unprecedented profit margins are close to a This article was written by Yiannis Zourmpanos 17.95K Followers Follow Hi, I'm Yiannis. Spotting winners before they break out is what I do best.Experience: Previously worked at Deloitte and KPMG in external/internal auditing and consulting. Education: Chartered Certified Accountant, Fellow Member of ACCA Global, with BSc and MSc degrees from U.K. business schools. Investment Style: Spotting high-potential winners before they break out, focusing on asymmetric opportunities (with at least upside potential of 3-5X outweighing the downside risk). By leveraging market inefficiencies and contrarian insights, we seek to maximize long-term compounding while protecting against capital impairment.Risk management is paramount—we seek a strong margin of safety to protect against capital impairment while maximizing long-term compounding. Our 2-3 year investment horizon allows us to ride out volatility, ensuring that patience, discipline, and intelligent capital allocation drive outsized returns over time. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in SKHY over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.