SK Hynix SKHY

Thesis

The U.S. listing got my attention. I compared the ADR with the existing South Korean shares and did some back of the napkin math on HBM orders, future demand, and potential price increases.

As with Micron, I thought the market’s fear was excessive relative to demand and the order backlog. HBM was a bottleneck in AI spending, and I thought tight supply could support pricing power.

What supported the view

Before I bought, SK Hynix had reported that customer demand exceeded its supply capacity. That supported my view of the bottleneck. I still had to make assumptions about future orders and pricing.

Supply was concentrated among SK Hynix, Samsung, and Micron. My opportunity depended on demand staying strong relative to the capacity available.

Decisions

I began buying in July and added as the price fell. I took profits into the August rebound. The thesis still held, so I bought again when the price looked attractive.

Still open

I continued trading into September.

What would change my mind

I would reconsider the thesis if orders for the AI chips that use HBM plateaued, or customers canceled their HBM commitments.