Kioxia stock price halved, analysts still optimistic about room for more than doubling the upside
The share price of Japanese semiconductor giant Kioxia Holdings has fallen sharply recently, falling by more than half since its historical high in June. However, most analysts still maintain a bullish view, with an average target price about 130% higher than the current share price. Kioxia's stock price closed at 52,110 yen on July 17, halved from the historical high of 112,700 yen set on June 22, and its market value ranking also fell from first to fourth in Japan. The Nikkei 225 index fell 4% that day, the fifth largest decline in history, and the semiconductor sector was under pressure across the board. This round of decline was affected by multiple factors: the market's concerns about the sustainability of AI capital expenditures have increased, expectations that competitors' production expansion may drive down memory chip prices have increased, and the overflow selling of South Korea's leveraged single-stock ETF has brought technical selling pressure. In addition, the liquidation of its holdings by major shareholder Bain Capital has also been interpreted as a warning signal by some investors. Despite the plunge in share prices, analysts' confidence in Kioxia's fundamentals has not wavered. According to media data, analysts’ average target price for the stock is 121,959 yen, which is about 130% higher than the current stock price. This gap ranks first among the top 100 companies with the largest market capitalization in the Topix Index. Kazuyoshi Saito, senior analyst at Iwai Cosmo Securities, maintained the target price of 132,000 yen, saying that "the fundamentals have not changed at all, and the company's strong profitability and growth logic remain solid supported by AI demand." Nomura Securities raised its target price from 115,000 yen to 126,000 yen last week, believing that NAND flash memory supply and demand will continue to improve and prices may rise. However, there are also opinions suggesting that the rebound will not happen overnight. Ikuo Mitsui, fund manager of Aizawa Securities, said that interference from factors such as Korean ETF capital flows means that Kioxia will not be able to regain its upward momentum until at least the end of August.