SK hynix unveils $29 billion buyback after AI-spending worries

SK hynix Inc. 2% in the previous session. The rebound comes as investors weigh a major shareholder-return plan against concerns over AI spending and higher interest rates. 01%.

Unveils $29 Billion Buyback, Boosts Shareholder Returns SK hynix is stepping up shareholder returns with a 40 trillion won ($29 billion) stock buyback. The company also raised its free-cash-flow payout commitment as investors reassess the outlook for memory stocks. SK hynix plans to repurchase up to 24 million treasury shares from Aug. 20 through Nov.

19 and cancel them. In addition, the company raised its shareholder return target to more than 50% of free cash flow. Previously, it had targeted returns of up to 50%. S.

listing a month ago. However, investors have since grown more cautious about the durability of AI infrastructure spending. eToro analyst Josh Gilbert told Bloomberg that the size of the buyback signals that SK hynix is responding to investor demands by deploying its growing cash reserves to boost shareholder returns. S.

listing would help close the valuation gap for its Korean-listed shares. While that has not happened, he said the buyback could help ease criticism from retail investors in Korea. AI Spending, Rates Remain Key Risks SK hynix is a major supplier of high-bandwidth memory to NVIDIA Corp. (NASDAQ: NVDA ).

As a result, the company has emerged as a major beneficiary of the AI data-center boom. Still, concerns about AI spending have recently pressured memory stocks. Higher bond yields have also weighed on technology valuations. Allspring Global Investments portfolio manager Gary Tan told Bloomberg that buybacks could provide a temporary cushion.

However, he said interest rates remain the bigger driver for memory stocks. 50. Forecasts range from $200 to $320. Wolfe Research and RBC Capital initiated coverage with Outperform ratings and $200 price forecasts on Aug.

4. Cantor Fitzgerald started coverage with an Overweight rating and a $300 price forecast the same day. 49 on the Edge scorecard. The readings point to strong growth characteristics but a more neutral valuation profile.

77% weighting in SKHY. 93 in Wednesday premarket trading, according to Pro data. Photo via Shutterstock Read Also: Micron Says Customers Are Scrambling for Memory Even at 'Very High' Prices