SK Hynix Could Nearly Double on AI 'Super-Cycle,' Bank of America Says

Bank of America has resumed coverage of SK Hynix with a Buy rating, projecting that the memory chipmaker’s shares could nearly double based on its dominance in the market for high-bandwidth memory (HBM) fueling the artificial intelligence boom. The bank argues that Wall Street has not fully priced in the potential for a sustained "operating profit super-cycle."

Bullish Outlook on AI Demand

In a note to clients, BofA initiated its price target for SK Hynix's Korea-listed shares at W3,000,000 and its U.S.-listed American Depositary Receipts (ADRs) at $250. The bank's core argument is that the company is the most strategically positioned memory chipmaker to benefit from the global AI infrastructure buildout.

This demand is expected to be driven by continued spending from large technology firms. "US Big Tech will keep increasing capex not only in 2027 but also in 2028, to US$1.0tn+ pa, using more advanced memory chips," BofA analysts wrote, dismissing the risk of near-term investment cuts.

Above-Consensus Forecasts

The bank's bullish stance is underpinned by financial projections that are significantly ahead of the market consensus. BofA highlighted the company's recent Q2 2026 results, which saw a 76% operating profit margin, as a sign of accelerating momentum.

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BofA's key forecasts include:

• DRAM Prices: Average selling prices (ASP) are expected to rise 25% quarter-over-quarter in Q3 and another 9% in Q4.
• Operating Profit: Quarterly operating profit is projected to hit W81 trillion in Q3 and climb above W90 trillion in Q4, putting its annualized run-rate above W300 trillion by year-end.
• Margins: The bank expects DRAM operating margins to be sustained at over 80% through 2028.

Valuation and Competitive Position

BofA noted that SK Hynix currently trades at roughly 4x the bank's 2027-28 earnings estimates, a multiple it characterized as historically low for a company at this point in a memory cycle. The W3 million price target is based on a valuation of 8x those future earnings, which BofA describes as a midpoint between the peak multiples of the 2017-18 cloud boom and the long-run historical average.

Analysts also see the company's market leadership as secure, forecasting it will hold more than 40% market share in HBM through 2028. The report suggests competitive threats are limited, with Samsung Electronics' HBM share expected to remain in the 30-40% range and Chinese chipmakers supplying less than 10% of the global market.