SK hynix ADR nears $200, hits post-listing high on chip crunch
SK hynix’s U.S.-listed shares surged 7 percent to a record as investors bet memory shortages and AI demand will support gains into 2027.
SK hynix CEO Kwak Noh-Jung takes a photo as he attends the company's opening bell ceremony at the Nasdaq market on the day of their IPO in New York City, United States, on July 10.
REUTERS/YONHAP
SK hynix's American depositary receipt (ADR) jumped more than 7 percent to a record high since its Nasdaq listing, as expectations that memory chip shortages could persist through next year boosted investor sentiment.
SK hynix's ADR closed at $198.63 on the U.S. stock market Wednesday, up 7.05 percent from the previous session. It rose as high as $199.87 during trading, nearing the $200 mark.
The closing price was the highest since the ADR was listed on the Nasdaq on July 10. It was also about 33 percent above its $149 offering price.
Expectations of memory chip shortages, particularly dynamic random-access memory (DRAM) and NAND flash, were seen as a key factor driving the gains.
UBS analyst Timothy Arcuri said supply shortages for both DRAM and NAND flash are expected to continue into 2027 in a research note on Tuesday.
Dan Kim, chief strategy officer at research firm TechInsights, rated the current memory market an 8 out of 10 for “craziness” in a Financial Times podcast released Friday. He also added that the situation could persist until at least the end of 2027.
Some market analysts estimate that memory chip inventories have fallen below 10 days of supply. With supply remaining tight and demand continuing to grow for high-performance memory, including high bandwidth memory used for AI, expectations are growing that strong market conditions could persist.
Global investment banks are also bullish on SK hynix.
Bank of America has a “buy” rating on SK hynix's ADR with a $250 price target, implying about 26 percent upside from Wednesday's close.
Eric Diton, president of Wealth Alliance, compared the semiconductor industry today to the “picks and shovels of the gold rush” and said semiconductors remain one of the most promising areas of investment in the market.
Global investor interest in SK hynix is expected to remain strong for the time being as expectations of prolonged memory chip shortages coincide with expanding investment in AI.
BY JEONG JAE-HONG [[email protected]]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
