SK Hynix’s Valuation Overtakes Samsung for the First Time – And Not a Single Chip Is Free

SK Hynix's forward PE edges past Samsung for first time, fueled by HBM monopoly, 194% DRAM price surge, and 72% operating margin. Risks remain from geopolitics and Samsung's catch-up.

For the first time in its history, SK Hynix now commands a higher forward earnings multiple than Samsung Electronics. The expected price-to-earnings ratio for 2026 sits at 6.79 for the chipmaker, edging past Samsung’s 6.77 — a symbolic reshuffling of South Korea’s semiconductor pecking order. The crossover comes as SK Hynix’s stock has surged nearly 169% since the start of the year, yet a jarring 7.66% single-day drop on Friday, which dragged the shares to 1,819,000 won from the prior close of 1,970,000 won, shows the rally is not immune to macro tremors.

The KOSPI index fell 6.1% to 7,493 points on Friday, dragged by escalating geopolitical tensions in the Strait of Hormuz and US 10-year yields climbing above 4.5%. Profit-taking after a blistering run — the stock had added roughly 60% in the prior 30 days alone — amplified the decline. But beneath the surface noise, SK Hynix’s operating story is one of extraordinary scarcity. Every DRAM, NAND and High Bandwidth Memory (HBM) chip the company produces has already been allocated, leaving zero free capacity. Goldman Sachs estimates the DRAM supply gap at 4.9%, the tightest in 15 years, giving SK Hynix immense pricing leverage: DRAM prices have jumped 194% year-on-year, NAND by 244%.

That pricing power is already visible in the numbers. Analysts expect second-quarter operating profit to hit 70 trillion won, roughly eight times the year-ago figure. KB Securities, which has lifted its price target to 3,000,000 won, forecasts full-year operating profit of 277 trillion won. First-quarter revenue reached 52.58 trillion won, with NVIDIA alone contributing 7.78 trillion won — a 62.6% surge. Another unnamed large client added 6.54 trillion won, equivalent to 12.4% of sales, likely Microsoft or Google. The US accounted for 33.99 trillion won of revenue, while China contributed 12.8 trillion won.

HBM dominance is the engine driving this outperformance. SK Hynix controls 54% of the global HBM market and has locked in roughly 70% of the HBM4 orders for NVIDIA’s upcoming Vera-Rubin platform. Crucially, its HBM4 yields already reach 80%, compared with Samsung’s sub-60% rate, and about 90% of all HBM output flows directly to NVIDIA. That concentration helped produce an operating margin of 72% in the first quarter — higher even than NVIDIA itself.

To sustain that edge, the company is accelerating capacity expansion. Phase 2 of Fab 1 at the Yongin Semiconductor Cluster is slated to begin in August 2026, with the first cleanroom operational by February 2027, representing an investment of around 31 trillion won. A recent partnership with Intel to use its EMIB technology for 2.5D packaging and a planned ADR listing in the US are aimed at deepening its integration into the global AI supply chain.

The valuation milestone, however, is not risk-free. Samsung is grappling with unprecedented strike threats and wage demands that JPMorgan estimates could shave up to 12% off operating profit, but it is racing to close the HBM4 gap. If Samsung achieves mass production of HBM4 by the second half of 2026, SK Hynix could face market-share erosion. So desperate are customers for capacity that Microsoft and Google are now exploring direct investments in new fabs.

Friday’s slide left the stock with an RSI near 69, still in overbought territory, meaning any sign of softening demand or progress from Samsung could trigger sharper corrections. For now, with every chip spoken for and HBM pricing power intact, SK Hynix’s fundamental case remains as robust as the new valuation lead it holds over its longtime rival.