SK Hynix made its Nasdaq debut last month, giving American investors a straightforward new way to buy into the booming memory chip market.
The Korean chipmaker joins Micron Technology (NASDAQ: MU) as one of the few pure-play memory stocks accessible to US-based retail and institutional investors alike.
Both companies have seen their valuations surge amid relentless demand for memory chips, which represent one of the biggest bottlenecks currently facing artificial intelligence infrastructure.
Micron has long been the default choice for investors seeking exposure to memory chip demand, but SK Hynix’s Nasdaq listing changes that calculus significantly.
The memory chip sector is cyclical by nature, which means both Micron and SK Hynix trade at strikingly low price-to-earnings multiples despite their strong recent earnings growth.
Micron currently trades at approximately 5.7 times expected earnings for fiscal 2027 ending next August, while SK Hynix trades at an even steeper discount of just 5 times forward earnings estimates.
That valuation gap exists despite the two companies sharing broadly similar revenue growth trajectories and operating margin potential going forward.
SK Hynix holds a notable edge through its close relationship with Nvidia (NASDAQ: NVDA), having secured a multi-year agreement to supply high-bandwidth memory chips to the chipmaking giant.
That contract has been reported to be worth as much as $500 billion, cementing SK Hynix’s position as a critical supplier within Nvidia’s AI hardware ecosystem.
SK Hynix management acknowledged that HBM4 chip sales came in slower than anticipated in the second quarter, but expressed confidence in a ramp-up during the back half of the year that should lift both sales volumes and average selling prices.
Long-term supply agreements do carry a trade-off, however, as locking in pricing with a partner like Nvidia limits the peak upside during a strong pricing cycle.
Micron has navigated a similar dynamic, with long-term deals now representing roughly 20% of DRAM chip revenue and about one-third of NAND chip revenue.
When analysts look further out to projected peak earnings in 2028, the valuation divergence between the two companies becomes even more striking.
Micron shares trade at close to 5.5 times fiscal 2028 earnings, while SK Hynix trades at just 3.5 times its projected 2028 earnings on the same basis.
That combination of a deeper valuation discount and a stronger near-term position within the Nvidia supply chain makes SK Hynix a compelling case for investors looking to ride the memory supercycle.
