SK hynix stock dives to new 52-week low on gloomy outlook for chips

[Courtesy of SK hynix]

SK hynix Inc. shares dived to a new 52-week low on Friday on concerns of worsening earnings outlook for the South Korean memory chip giant.

Shares of SK hynix are trading at 78,800 won ($60.21), down 1.75 percent from the previous session, on Friday, at 1:52 p.m. in Seoul. The stock opened the day 3.12 percent lower at 77,700 won then lost more to record a fresh 52-week intraday low of 77,500 won. Samsung Electronics shares are also trading weak, losing 0.34 percent to 59,100 won.

Korean chip stocks have been tumbling as global semiconductor market outlook grows dimmer. Their decline was accelerated on Friday morning that global chip market benchmark index PHLX Semiconductor Index fell 4.17 percent in the U.S. overnight.

SK hynix shares have been on a downward spiral this month, sinking below 80,000 won for the first time in nearly two years.

The company is expected to report an operating loss of 506.1 billion won in the fourth quarter, according to a recent report by Hanwha Investment & Securities Co. The brokerage firm projected SK hynix to swing to an operating loss of 2.4 trillion won with sales plummeting 26 percent on year to 33.2 trillion won in 2023. The price target for SK hynix stock was revised down to 105,000 won from 110,000 won.

The global chip market won’t be likely to show any meaningful improvement in demand until the second quarter of 2023, Hanwha Investment said, adding that additional fall in chip prices and earnings deterioration are inevitable.