An unverified rumor has recently surfaced, suggesting that target prices for Samsung Electronics and SK hynix have been raised to astronomical levels.
This rumor, while unconfirmed, perfectly captures the current mood in the semiconductor market, which is experiencing a powerful 'supercycle.' At the heart of this boom is the explosive demand for AI, which requires massive amounts of specialized, high-performance memory called HBM (High Bandwidth Memory). Because HBM is complex to produce, supply has struggled to keep up with demand, causing prices to soar. This tightness has also spilled over into the market for conventional memory chips like DRAM and NAND, as manufacturers shift their production capacity to the more profitable HBM.
The impact of this supercycle is clear in the companies' financial results. Both Samsung and SK hynix reported their best-ever quarterly earnings for the first quarter of 2026. First, the intense demand for HBM from major AI chip designers like NVIDIA created a supply bottleneck. Second, this allowed memory makers to sign lucrative long-term agreements and command high prices. Third, these factors directly translated into record-breaking profits, giving securities analysts the confidence to aggressively raise their Target Prices (TP).
However, the path forward isn't without obstacles. A major risk on the horizon is a potential large-scale labor strike at Samsung planned for late May. If it proceeds, it could disrupt production and affect global supply chains. Furthermore, geopolitical tensions remain a concern. The United States reviews its export licenses annually for Samsung and SK hynix to ship advanced chip-making equipment to their factories in China. Any change in this policy could introduce significant operational uncertainty.
In essence, while the incredible earnings performance provides a solid foundation for a bullish outlook on Samsung and SK hynix, the rumored target prices of KRW 500,000 and KRW 3,000,000 remain speculative for now. The future trajectory will depend on how well these giants capitalize on the HBM opportunity while navigating labor and geopolitical risks.
- HBM (High Bandwidth Memory): A type of high-performance memory chip stacked vertically to provide faster data transfer speeds, essential for training and running AI models.
- Target Price (TP): An analyst's projection of a stock's future price over a specific period, typically 12 months. It's a forecast, not a guarantee.
- Supercycle: A period of unusually strong and sustained demand growth in a cyclical industry, like semiconductors, leading to higher prices and profits.