KR · Educational sample
SK hynix (000660.KS)
HBM winner narrative — strong cycle beta, thin margin of safety in euphoria.
Business
SK hynix focuses on DRAM and NAND, with high-bandwidth memory as the current profit spearhead for AI accelerators. Capex intensity is high; returns arrive when technology leadership meets tight supply. Cash conversion can surprise violently to both sides of the cycle.
Moat
Process leadership in HBM and packaging relationships with GPU makers are the near-term moat. Scale in DRAM still matters when the cycle turns. Technology lead is perishable — the moat must be re-earned each process node.
Valuation
In HBM euphoria the stock can capitalize scarcity as if it were permanent franchise value. Stress-case owner earnings after ASP normalization are the only honest denominator. Korea discount and customer concentration should widen, not shrink, the required margin of safety.
Price bands
Buy zone when mid-cycle HBM and commodity DRAM cash flows still clear your hurdle after a demand air pocket. Wait while the winner narrative leaves no room for a lost node.
What to ask
Own cycle beta only when the price already assumes a hangover — not when it assumes eternal HBM scarcity.
Risk
Customer concentration among GPU makers, technology leapfrog risk, and Korea discount can reverse the narrative fast. Capex mis-timing through a downturn destroys equity value even for technology leaders.
Educational research only. Not investment advice. Sample memos are static illustrations of the ValueDesk lens — run a live memo on any ticker in the desk.