Memory super cycle confirmed! Samsung share price pullback is strong indicator, Nanya Tech posts record profit (BofA)
The Bank of America (BofA) report emphasized that the recent decline in Samsung Electronics' stock price runs counter to the strong fundamentals of memory chips and is a strong buy signal.
The Bank of America (BofA) report emphasized that the recent decline in Samsung Electronics' stock price runs counter to the strong fundamentals of memory chips and is a strong buy signal. The bank's memory indicator is at an all-time high, confirming the continuation of the "super cycle." CXMT’s IPO and Nanya Tech’s ultra-high profits in the traditional DRAM field both confirm the prosperity of the industry. The report pointed out that global DRAM demand and average selling price (ASP) have increased significantly, and CXMT's market share is limited and does not pose a serious competitive threat. Nanya Tech set a historic gross profit margin record and was reiterated with a "buy" rating. The market's concerns about the memory cycle (stemming from the correction in Samsung's stock price) may be wrong. BofA believes that the super cycle is far from over, and the logic of tighter non-China high-end DRAM supply may be underestimated. One-sentence conclusion: The correction of Samsung's stock price is a serious departure from the fundamentals of the memory super cycle. BofA believes that this is a significant buying opportunity. Strong demand and tight supply driven by AI will continue to drive industry profits beyond expectations. Positive/negative: Positive for Samsung Electronics, SK Hynix, Micron Technology, and Nanya Tech. The market's concerns about Samsung's stock price are the main risk, but BofA believes that this just provides an excellent entry point, and the strong fundamentals of the industry have not yet finished driving the stock price. Catalysts: 1) Samsung Electronics (next week) and SK Hynix’s 2Q26 financial reports; 2) Latest quotations of memory contract prices (1H-Aug/2H-Aug); 3) Actual purchase volume data of HBM and DDR5 for AI servers.