SK Hynix shares fall after stellar Nasdaq debut

SK Hynix shares tumbled more than 10% in Seoul on Monday following the chipmaker’s strong Nasdaq debut on Friday; Investors locked in profits and weighed whether rising demand for AI memory chips could justify the stock’s steep rise.

south korean memory chip manufacturer It was up 13% in its debut on Wall Street on Friday; This reflected US investors’ strong appetite for AI-related semiconductor stocks.

Monday’s decline reflects a mix of profit-taking and uncertainty about how U.S.-listed stocks should be valued relative to Korean stocks; Analysts say ADR’s debut effectively creates a new reference point for investors to evaluate the company’s valuation.

“Everyone is really confused about what will happen to memory demand and where the fair price will be,” Daniel Yoo, global strategist at Yuanta Securities, said on “Squawk Box Asia.” “It’s all about how much demand there is and how much supply will come… [and] What kind of multiple will you get?”

Taiwan Semiconductor Manufacturing CompanyYoo noted that .’s U.S.-listed ADRs are trading at a roughly 13% to 14% premium to its domestic shares, adding that SK Hynix’s sharp move has created a discount rate of more than 20% between its U.S. and Korean listings.

Yoo stated that the sales were also due to IPO mechanisms, describing it as an “additional share issuance” that increased the stock supply available to investors. “The market sees this as a correction period for SK Hynix domestically.”

The pullback will likely be temporary as demand for structured AI continues to outpace supply, he said, adding that despite short-term volatility, stocks will likely move “in the right direction” over the next six to 12 months.

Phillip Wool, chief research officer at Rayliant Global Advisors, also downplayed the recent weakness in AI hardware names in Asia, describing it as a portfolio rebalancing exercise rather than a deterioration in the sector’s outlook.

“I think it’s mostly risk management,” Wool said, noting that many investors have accumulated large positions in South Korean and Taiwanese AI chip makers following strong earnings. “Prudent risk management suggests you need to scale them back.”

He added that the sale “doesn’t really indicate any waning in excitement around AI hardware.” AI investment is moving beyond semiconductors, but it should continue to benefit memory suppliers like SK Hynix, Wool said.