Cantor Fitzgerald: SK Hynix ADR Stock Price Could Double in the Next 12 Months, Target Price $300

August 5th. According to CNBC, SK Hynix has received coverage from multiple Wall Street investment banks after its U.S. listing. Cantor Fitzgerald has set a target price of $300, indicating a potential upside of over 100% from Monday's closing price of $142.72. It is expected that the construction of AI infrastructure will continue to drive demand for DRAM, NAND, and HBM.

Cantor analyst C.J. Muse stated that the bit demand for DRAM and NAND may significantly exceed supply at least until 2029. Customers such as Nvidia and Alphabet are locking in capacity through multi-year contracts, with some agreements covering purchase volume, price ranges, prepayments, and default terms, enhancing the profitability and order visibility of memory chip manufacturers.

Other investment banks are also optimistic about SK Hynix, with Bank of America, Stifel, and Royal Bank of Canada setting target prices of $250, $240, and $200 respectively. Royal Bank of Canada anticipates that the company's operating profit margin will increase from 76% in the second quarter to 86% next year.

Stifel pointed out that the main risks include technological iterations leading to product obsolescence and demand being overly concentrated among a few U.S. hyperscale cloud providers. SK Hynix's American depositary receipt began trading on Nasdaq on a when-issued basis on July 10th. According to Bank of America data, the company raised approximately $26.5 billion by selling 178 million shares.