Motley Fool Calls SK Hynix the Best AI Memory Stock to Buy Now

Not Micron or SanDisk: US outlet picks Korean chipmaker as top AI memory play

Motley Fool says SK Hynix offers a buying opportunity

A US investment publication has picked SK Hynix over Micron and SanDisk as the best artificial intelligence memory stock. The call comes as spending on AI data centers fuels a surge in demand for high-bandwidth memory, or HBM. The outlet said SK Hynix stands out for its market dominance and lower valuation, adding that “a stronger opportunity may be hiding in plain sight.”

The Motley Fool said in an article published on Aug. 10 that SK Hynix was the most promising AI memory stock. The article was headlined, “It’s Not Micron or SanDisk: The Best AI Memory Stock Is This South Korean Company.”

The publication said Micron and SanDisk have recently emerged as leading ways to invest in the AI memory market. Both companies have drawn investor attention on expectations that expanding AI data centers will lift memory demand. Still, The Motley Fool singled out SK Hynix as the stronger opportunity.

It also pointed to SK Hynix’s recent share-price pullback. The decline reflected elevated market expectations and a broader selloff in technology stocks rather than weaker company fundamentals, it wrote. That could create an opportunity to buy the stock at a lower price.

SK Hynix’s biggest strength is its dominance in the HBM market. Citing data from market research firm IDC, The Motley Fool said SK Hynix held a 56.4% share of the HBM market in the first quarter of this year. That put it well ahead of rivals.

HBM is high-performance memory used when AI accelerators process large volumes of data. It offers faster data throughput and better power efficiency than conventional DRAM, making it a key component for AI chipmakers including Nvidia. As investment in AI data centers grows, HBM demand should rise as well. The Motley Fool said SK Hynix could extend its long-term gains on the back of that market leadership.

Valuation was another part of the case. According to The Motley Fool, SK Hynix trades at about 5.5 times forward earnings, compared with 5.9 times for SanDisk and 12 times for Micron. The publication said the Korean chipmaker trades at a lower valuation than its US memory peers.

The Motley Fool also highlighted growth in SK Hynix’s long-term supply agreements, or LTAs. If investment in AI infrastructure continues to drive structural demand for high-performance memory, the company could turn the memory supercycle into a longer period of earnings growth.

The publication also said the rise of the AI industry has pushed the memory-chip market into a new phase. In the past, memory semiconductors were viewed as a cyclical business marked by oversupply and falling prices. Since the spread of generative AI, however, high-performance memory including HBM has become a core component of AI data centers, changing that picture.

Kang Kyung-ju, Hankyung.com reporter, qurasoha@hankyung.com