In a striking vote of confidence for South Korea’s semiconductor giants, Eugene Investment & Securities on May 4, 2026, upgraded its investment ratings for Samsung Electronics and SK Hynix to "Strong Buy," a notch above its previous "Buy" recommendation. This rare move signals the brokerage’s belief that both companies are poised for extraordinary gains, with 12-month target returns now forecast to exceed 50%—a bold projection in any market environment.
The decision comes amid a whirlwind rally for both stocks. According to Hankyung, Samsung Electronics’ market capitalization stood at approximately 1,289 trillion KRW and SK Hynix at about 917 trillion KRW as of April 30, 2026. Combined, the two tech behemoths now account for a staggering 40.77% of the entire KOSPI market capitalization—a testament to their dominance in the South Korean stock market. In April alone, Samsung Electronics’ share price surged by 31.88%, while SK Hynix rocketed up by an eye-watering 59.36%. The broader KOSPI index also soared, posting a 30.61% jump for the month.
But what’s driving such optimism—and is it sustainable? Eugene Investment & Securities has dramatically raised its 12-month target prices for both companies, with Samsung Electronics’ target leaping from 210,000 KRW to 360,000 KRW, and SK Hynix’s from 1,170,000 KRW to 2,300,000 KRW. These targets reflect not just short-term momentum, but also a belief in deeper, structural growth for both firms.
Of course, it’s not all plain sailing. There are clouds on the horizon, notably the ongoing labor unrest at Samsung Electronics. As Yonhap Infomax reports, union strikes have cast a shadow over the company, creating uncertainty that’s weighed on its stock performance relative to competitors. Yet, Eugene’s analyst Son In-jun remains upbeat. He notes, "Recently, Samsung Electronics has shown weaker stock performance compared to competitors due to concerns over union strikes. This uncertainty will persist until negotiations are settled, but considering the structural growth expected from the memory supercycle and the company’s business unit linkage strategies, the upward trend in the stock price is likely to continue."
For SK Hynix, the outlook is equally robust despite some recent hiccups. Delays in customer certification for the company’s next-generation HBM4 memory have been a concern, but the brokerage expects SK Hynix to reassert its leadership in high-bandwidth memory (HBM) next year. The analyst explains, "Next year, server memory demand is expected to grow by at least 60% in bits, which suggests that supply shortages will intensify based solely on current projections for server demand. In addition, the recovery of sluggish smartphone and PC unit demand and increased content will further exacerbate supply shortages."
This supply crunch could prove lucrative for both companies. According to Eugene Investment & Securities, price negotiations for HBM next year are projected to be "at a high level, considering the profitability of DRAM and NAND." Furthermore, the blended average selling price (ASP) growth rate for DRAM is expected to once again be the highest in the industry. For investors, these are tantalizing signals that the profit cycle still has plenty of room to run.
Yet, not everyone is convinced the rally is immune to broader market forces. As Hankyung notes, the well-worn adage "Sell in May" is making the rounds among market watchers, with some analysts warning of a potential correction in the coming weeks. Historical data backs up these concerns: analysis of the S&P 500 since 2010 shows a statistically significant tendency for market pullbacks from early to mid-May, a pattern that’s often mirrored in the Korean market. On April 30, after three consecutive days of record highs, the KOSPI index dipped by 1.38%—a reminder that gravity still exists, even in the hottest markets.
What happens if the semiconductor rally cools off? Some experts see opportunity in rotation. Lee Kyung-soo, a researcher at Hana Securities, told Hankyung, "A correction in May could trigger a rotation in stock demand, and when the overbought focus on semiconductors disperses, alternative stocks with solid earnings will become attractive." He points out that stocks with upwardly revised earnings estimates have historically performed well in May, suggesting that investors may soon start hunting for value beyond the obvious tech leaders.
Still, the scale of the recent upgrades for Samsung Electronics and SK Hynix dwarfs most other contenders. In April, Samsung Electronics saw its annual operating profit consensus estimate jump by a remarkable 56%—the largest increase among all tracked stocks. SK Hynix wasn’t far behind, with a 46.74% upward revision, ranking fourth overall. SK Hynix’s share price, for its part, climbed 60.22% by April 29. Other companies—such as energy stocks like S-Oil, which benefit from Middle East supply disruptions, and renewable energy or battery material firms like Hanwha Solutions and EcoPro BM—have also seen upward earnings revisions. However, their stock price gains have lagged behind the semiconductor titans, and their operating profit upgrades, while notable, are not on the same scale.
For those seeking alternatives, the list includes semiconductor materials and equipment suppliers like ISC, PSK, and Wonik IPS, but their annual operating profit consensus increases—7.46%, 6.85%, and 6.7% respectively—are modest compared to the giants. Their stock gains, too, are less dramatic, with none reaching even half of Samsung Electronics’ April performance.
Market observers are left to weigh two competing realities: the extraordinary momentum and profit potential of Samsung Electronics and SK Hynix, and the ever-present risk of a broader market correction. The semiconductor sector’s dominance is both a source of national pride and a potential point of vulnerability for Korean investors, given its outsized influence on the KOSPI.
As the dust settles on a record-setting April and investors brace for what May might bring, one thing is clear: the story of Samsung Electronics and SK Hynix is far from over. Whether the rally continues or the market takes a breather, these two companies remain at the center of Korea’s investing universe—watched closely by analysts, investors, and rivals alike.
For now, with target prices soaring and structural growth drivers firmly in place, the semiconductor giants look set to keep their grip on the spotlight, even as the market’s mood shifts with the seasons.