Goldman Sachs raises target prices for Samsung and SK Hynix due to strengthening memory prices

Investing.com - Goldman Sachs states that with rising memory prices and tightening industry supply due to AI-related demand, Samsung Electronics and SK Hynix may see stronger profit performance.

The broker has raised SK Hynix’s target price from 1.2 million won to 1.35 million won and reaffirmed its buy rating. Goldman Sachs also increased Samsung Electronics’ target price from 205,000 won to 260,000 won.

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Goldman Sachs said that after raising its forecasts for traditional DRAM and NAND memory prices, it has improved its earnings outlook. The bank noted that early negotiations for supply in Q2 2026 are at a higher starting point than expected a few months ago.

Although demand in segments like PCs and smartphones is not particularly strong, supply across multiple end markets remains tight. Goldman Sachs states that demand from AI servers is absorbing most of the available memory supply.

For SK Hynix, the bank expects the company to benefit from one of the strongest traditional memory upcycles in years. Goldman Sachs forecasts an operating profit of 34.7 trillion won in Q1 2026 and about 202 trillion won for the full year, both above market consensus expectations.

The broker states that the company’s operating profit margin for DRAM could reach over 70% this year, and NAND margins could exceed 40%. Goldman Sachs also expects SK Hynix to maintain its leadership in AI memory products, supporting a return on equity of over 80%.

The bank also says that Samsung Electronics’ profitability could improve significantly. Goldman Sachs forecasts an operating profit of 40.3 trillion won in Q1 and about 239 trillion won for the full year 2026.

This improvement will reflect stronger memory prices and growth in high-bandwidth memory used in AI computing. Goldman Sachs expects Samsung’s operating profit in 2026 to increase more than fivefold, with an ROE of around 37%.

Despite the improved outlook, the broker states that based on expected 2027 earnings, these two stocks still have relatively low valuations. Given the anticipated growth in memory demand, the firm considers them attractive.

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