Buy and hold SK Hynix (possible in europe) for possible 2-3x in the coming 6 months.
u/bitcrespi ·
Reddit — r/ValueInvesting
· May 31, 2026 at 18:27
· ⬆ 17 pts
· 💬 14 comments
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AI Summary
Summary
The post argues that SK Hynix is deeply undervalued relative to Micron and TSMC, based on a comparison of market cap to quarterly net profit.
The author expects a 2-3x price appreciation within 6 months, citing a potential US listing as a catalyst for multiple expansion.
Quality assessment: Partially data-driven but ignores capital structure, cyclicality, and growth differences – more speculative than well-researched DD.
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SK hynix is listing on the US markets in the coming months.
Q1 2026 financials highlight a striking valuation gap among SK and other semiconductor leaders:
SK hynix: \~$37B revenue, \~$28.5B net profit, \~$1.1T market cap
Micron: \~$24B revenue, \~$13.8B net profit, \~$0.9–1.0T market cap
TSMC: \~$35B revenue, \~$18.5B net profit, \~$1.9T market cap
Looking at market cap relative to quarterly profit:
\- SK hynix trades at roughly 39x quarterly profit
\- Micron trades at roughly 67x quarterly profit
\- TSMC trades at roughly 103x quarterly profit
Despite generating more quarterly profit than either Micron or TSMC, SK hynix trades at a significantly lower valuation multiple.
If SK hynix were valued at Micron’s multiple, its market cap would be closer to $1.9 trillion.
If SK hynix were valued at TSMC’s multiple, its market cap would approach $2.9 trillion.
\*yes this is AI written, but never the less still valid.
SK Hynix generates ~$28.5B net profit on ~$37B revenue, yet trades at ~$1.1T market cap – a much lower profit multiple than Micron (~67x) and TSMC (~103x). If SK Hynix were revalued to Micron’s multiple, its market cap would rise to ~$1.9T (72% upside); to TSMC’s multiple, ~$2.9T. The upcoming US listing could narrow the gap. Bet on mean reversion in valuation multiples driven by increased visibility and liquidity from a US listing, targeting 2-3x return in 6 months. Cyclical downturn in memory chip demand, heavy debt burden, geopolitical risks (Korea exposure), and the US listing may not trigger immediate re-rating.