Memory Supercycle Boosts Profitability – Nomura Raises Target Prices for Korea’s “Chip Duo”

Driven by strong U.S. stock performance and improving profitability prospects in the “memory supercycle,” shares of Korea’s “chip duo” — SK Hynix and Samsung Electronics — both rose in Friday morning trading.

SK Hynix climbed back above 600,000 KRW, last at 602,500 KRW (+2.47%); Samsung Electronics hit a new all-time high intraday at 116,900 KRW, last at 116,500 KRW (+4.86%).

U.S. markets were closed Wednesday (Dec 25) for Christmas. On Christmas Eve (Dec 24), U.S. stocks rallied across the board, delivering the anticipated “Santa Claus rally” with all three major indices closing strongly. This positive sentiment spilled over into Korean markets.

Additionally, Nomura Securities reportedly maintained a “Buy” rating on SK Hynix and raised its target price to 880,000 KRW from the previous 840,000 KRW.

Nomura said: “As AI investment and server deployments accelerate, pricing power is shifting to suppliers, giving memory companies a more flexible environment to adjust product mixes.”

Nomura also lifted its Samsung Electronics target from 150,000 KRW to 160,000 KRW, noting substantial earnings upside into next year amid sustained memory price gains.

“General-purpose DRAM and NAND flash prices rose sharply in Q4, rapidly boosting memory industry profitability,” Nomura stated.

The firm highlighted Q4 general-purpose DRAM price gains of 30%–40%, with server DRAM expected up 40%–60% QoQ.

Earlier this week, reports citing semiconductor industry sources said Q4 memory gross margins for Samsung and SK Hynix are estimated at 63%–67% — exceeding TSMC’s 60%.