SK hynix shares hit 52-week high as Nvidia becomes world's most valuable company

Industry

Published: 19 Jun. 2024, 10:19 Updated: 19 Jun. 2024, 17:04

SK hynix shares hit 52-week high as Nvidia becomes world's most valuable company

The Nvidia headquarters on May 21 in Santa Clara, California. Nvidia edged ahead of other tech firms on Tuesday to become the world's most valuable publicly traded company in the latest sign of the might of artificial intelligence. [GETTY IMAGES/YONHAP]

SK hynix shares hit a 52-week high during early trading on Wednesday as Nvidia overtook Microsoft and Apple to become the world's most valuable company overnight.

Nvidia's valuation surpassed $3.34 trillion on Tuesday after undergoing a nonstop surge to skyrocket ninefold since the end of 2022, when enthusiasm over AI just started to creep in.

Shares of SK hynix, a supplier to Nvidia, reached 240,000 won ($174), rising nearly 3 percent during morning trading on Wednesday.

It closed at 233,500 won, sliding 0.43 percent as investors cashed in.

"SK hynix's leadership in the high bandwidth memory (HBM) market will continue for a while longer as advancement into the market by rivals is taking longer than expected," said Kim Kwang-jin, a researcher from Hanwha Investment & Securities.

HBM is a premium type of dynamic random-access memory chip that is essential for AI processors in order to run the vast amounts of data required to train AI models.

"SK hynix monopolized the HBM3E market this year. It also is collaborating with TSMC on HBM4 when the concept of chip customization comes in. Closing the technology gap with SK hynix for latecomers will not be easy."

Local securities firms increased their target price for SK hynix. Hanwha Investment raised it to 280,000 won from 210,000 won, while Daishin Securities raised it to 265,000 won from the previous 230,000 won and Hyundai Securities also increased it to 270,000 won.

The chipmaker's shares have more than doubled over the past year, riding high on the AI boom.

Its nearly exclusive HBM supply deal with Nvidia, the major player of the AI chip market, continued to boost its value.

Samsung Electronics shares also rose by more than 2 percent in morning trading, reaching 81,400 won. It closed at 81,200 won, up by 1.75 percent from the previous trading day.

Samsung Electronics has not yet passed the verification test for the latest HBM chip series for Nvidia.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]