Jim Cramer Warned US Would “Rue” SK hynix’s (SKHY)’s Market Entry – The Selloff Might Have Proven Him Right

As the outgoing week demonstrated, SK hynix Inc. (NASDAQ:SKHY) is one of the most important stocks in the market. The shares are down by more than 16% over the past five days as investors reacted rather violently to a slate of worrying news regarding the ongoing AI buildout. One major report came in the form of remarks by CXMT President, Dr. Cao Kanyu, who claimed that his firm had progressed in a key memory fabrication technology. Cramer tweeted about the movement in the shares:

“High level of fear would normally be attractive. But you have to find buyers of Coreweave bonds, Oracle common stock and SK Hynix, of course. The latter is the epicenter of fear because the Kospi is still up more than 50% so lots of people under water

“SK Hynix still in charge

The violent reaction in the shares points towards the debate surrounding SK hynix, which relates to the demand for AI chips. It, along with Samsung and Micron, is a key player in the high bandwidth memory (HBM) industry. HBM chips are key for AI chip development, and the surging demand led the firm to post a 257% annual revenue growth in its second quarter. The top line growth was accompanied by an equally strong bottom line growth as SK hynix’s operating profit jumped by 557% annually.

With memory chips typically thought of being a cyclical commodity, SK hynix also confirmed during its earnings that it had long term supply agreements with 10 customers to hint at a secular business unperturbed by cyclical fluctuations.

Yet, while management and the bulls assert secularity, the forward P/E ratio of 5.4x still reflects cyclicality which was also bolstered by a recent report from Counterpoint Research that outlined that it expected DRAM memory chip prices to drop by 23% in 2028 over 2027. While China’s CXMT might be unable to compete with SK hynix in the HBM market in the short term, other reports have suggested that the firm might experience HBM4 disruptions as some of its equipment orders had slipped into 2027 from H2 2026. And, even though SK hynix manufactures high end memory chips, it didn’t make it on our list of 10 Most Promising Technology Stocks to Buy Right Now. However, another memory manufacturer did.

As for Cramer, the recent share price dip came after the CNBC TV host had warned in August that “we will rue the day we let this Monster into our markets.” While he praised the firm’s business, factors unrelated to the fundamentals drove the viewpoint. For Cramer’s complete remarks, you can read Jim Cramer Says US Markets Will Regret Letting SK hynix Inc. (NASDAQ:SKHY) In.

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