Share Buyback Plans:
1. SK Hynix: Announced on August 19th a share buyback and cancellation of approximately 40 trillion won (approximately US$28.6 billion). This involves the buyback and cancellation of approximately 24.07 million shares, representing about 3.3% of issued shares, marking the largest treasury stock cancellation in South Korean history. The buyback period is approximately 3 months. The company has raised its shareholder return target to "more than 50% of cumulative free cash flow."
2. Samsung Electronics: Expected to announce a shareholder return plan exceeding 100 trillion won (approximately US$71.7 billion) by the end of August, with a proposed allocation of 50% of free cash flow for shareholder returns.
3. SanDisk: On August 5th, SanDisk added US$14 billion to its buyback authorization, bringing the remaining authorization to US$15.5 billion. It is one of the most aggressive US storage stocks recently.
4. Kioxia: On July 31st, Kioxia announced a buyback program of up to 800 billion yen (approximately US$5.1 billion), representing 5.5% of issued shares, a pioneer in this round of large-scale buybacks in the storage industry. It also simultaneously conducted a 1-for-3 stock split.
5. Micron Technology: Its share buyback program is currently suspended due to restrictions related to the Chip Act, and is scheduled to resume after the restrictions are lifted on December 9, 2026. The company stated that after the restrictions are lifted, it can return 100% of its surplus cash to shareholders, with buybacks being the primary method.
Institutional Views:
1. SK Hynix:
① JPMorgan Chase: Maintains "Buy," target price 2.75 million won. It believes the policy upgrade is significant and expects Hynix to potentially return at least $130 billion to shareholders by 2027.
② Barclays: Maintains "Overweight," target price $300. It raised its 2027 quarterly dividend forecast to 2,500 won per share and its year-end dividend forecast to 10,000 won.
③ Goldman Sachs: Maintains "Buy," target price 3.5 million won. It predicts a shareholder return of up to 8% in 2027 and approximately 7 trillion won in additional buyback potential.
④ Nomura: Maintains "Buy," target price 4.7 million won. The company forecasts free cash flow of 156 trillion won and 318 trillion won for fiscal years 2026 and 2027 respectively. Based on a 50% return ratio, shareholder returns would be approximately 78 trillion won and 159 trillion won respectively, equivalent to shareholder returns of approximately 7% and 15%.
⑤ CLSA: Gives a "High Conviction Outperform" rating with a target price of 3.7 million won. It believes share buybacks are a strong signal that the stock is undervalued, and total shareholder returns in 2026 may exceed 100 trillion won.
2. Samsung Electronics:
① KB Securities: Gives a "Strong Buy" rating with a target price of 600,000 won. It forecasts that the new shareholder return policy will result in annual dividends and buybacks totaling 100 trillion to 200 trillion won, a 10 to 20-fold increase from the current level.
② Meritz Group: Maintains a "Buy" rating with a target price of 500,000 won. Profit growth is expected to continue until the end of the year, with demand for AI servers, HBM, and SOCAMM rapidly absorbing market supply, and memory shortages persisting until the end of next year.
③ACT Research Institute: At current valuations, the expected return on share buybacks is approximately 25%, significantly higher than the 14% dividend yield. It recommends prioritizing buybacks over special dividends, with a minimum buyback target of 45 trillion won and a maximum of 91 trillion won if cash flow allocation reaches 100%.
3. SanDisk:
①Citi: Maintains "Buy" rating with a target price of $2100. SanDisk is expected to continue its share buyback program.
②JPMorgan Chase: Initiates coverage with an "Overweight" rating and a target price of $2250.
4. Kioxia:
①UBS: If half of the expected net profit of ¥9.42 trillion in fiscal year 2028 is used for buybacks, approximately 19% of outstanding shares can be cancelled; ROE forecast revised upwards from 42% to 48%, and the price-to-book ratio revised upwards from 4.63 to 5.23.
② JPMorgan Chase: Maintains "Overweight" rating with a target price of ¥155,000, expecting significant upside potential.
5. Micron Technology:
① UBS: Maintains "Buy" rating with a target price of $1,625. Micron is expected to generate approximately $380 billion in free cash flow in 2027-2028, which could allow for a share buyback of approximately 20%-30% at the current share price.
② JPMorgan Chase: Maintains "Overweight" rating with a target price of $1,540. Sixteen strategic client agreements have secured approximately $100 billion in committed revenue, guaranteeing long-term profitability.
