【Big Bank Report】Barclays: SK hynix’s target price raised by 20%; China manufacturers’ rapid expansion is not impacted

Barclays released a research report that maintains an optimistic outlook on Samsung Electronics and SK Hynix overall, keeping an “Overweight” rating, raising SK Hynix’s target price from €900 to €1,100, and increasing Samsung’s target price from $4,000 to $4,250.

Barclays expects memory prices to continue developing favorably, with no signs of supply tightness ending in the short term. The firm states that, due to a significant increase in memory content in data center architectures by 2027, although manufacturers are accelerating new capacity expansion, it will still be difficult to substantially narrow the supply-demand gap in the next one or two years.

Barclays’ on-the-ground investigation confirms that Chinese memory manufacturers are rapidly expanding capacity, with some increasing market share in the mid-to-low-end smartphone market (mainly in NAND), which poses certain risks to the supply and demand outside the data center market, but is not expected to impact the data center market.

Regarding SK Hynix, Barclays notes that although Q1 results slightly missed broker expectations, SK Hynix is expected to continue maintaining its leadership in high-bandwidth memory (HBM). The revised 2026 estimates still lead market consensus.

Barclays has raised SK Hynix’s 2026 estimated P/E ratio from 5x to 6x, roughly aligning with Micron’s valuation multiple, which has driven the target price up by over 20%. Additionally, future potential U.S. depositary receipt (ADR) listings are seen as catalysts for valuation re-rating.

However, Barclays warns of key risks for SK Hynix, including intense competition leading to loss of HBM market share, a slowdown in AI-related demand, and capacity expansion lagging behind expectations, which could prevent the company from fully capturing future opportunities.

For Samsung Electronics, Barclays indicates that in the short term, Samsung will benefit noticeably from improvements in DRAM average selling prices (ASP). At the same time, Samsung has demonstrated strong execution in HBM business, with broker estimates suggesting that its 2026 HBM revenue will triple the guidance, supporting the view that Samsung can achieve significant HBM market share this year.

Although the mobile device business faces pressure, with broker estimates lowered and shipments expected to decline by 12% in 2026, semiconductor pricing power remains much stronger than expected, leading to an upward revision of overall profit forecasts, with total revenue expected to grow in double digits.

Barclays states that Samsung Electronics’ valuation multiple remains unchanged at an estimated 2.5x price-to-book (PB) ratio in 2026. The broker is optimistic about its diversified business model and believes its smartphone business carries lower risk compared to peers.

Regarding investment risks for Samsung Electronics, Barclays highlights factors such as fierce competition in wafer foundry leading to market share loss; long-term weakness in the overall economy limiting revenue growth; and China achieving self-sufficiency in advanced semiconductor manufacturing and consumer electronics, resulting in revenue loss in the Chinese market.