If you put $10,000 into Armsttock when

it went public three years ago, you'd

have $40,000 today. If you put that

money into Palunteer's direct listing in

2020, you'd have almost 200 grand. Well,

SKH Highix makes the memory chips that

every AI data center is racing to buy,

and they listed on the NASDAQ earlier

this summer. My name is Alex and I spent

eight years as an electrical engineer

and AI researcher at MIT which helped me

find great stocks like Nvidia, Micron,

and TSMC years before the rest of the

market. So, let me show you what SKHEX

actually does and if they're worth

investing in. Your time is valuable, so

let's get right into it. I want to start

this video in an interesting place.

November 2022 in San Francisco. OpenAI

just released Chat GPT and it instantly

spread like wildfire, hitting a 100

million users in just 2 months. It grew

four times faster than Tik Tok, 15 times

faster than Instagram, and 25 times

faster than YouTube. The wave that

followed turned into the biggest

technology investment cycle since the

internet. And over the next four years,

Nvidia would grow from a $400 billion

valuation to over five trillion because

they designed the chips powering chat

GPT and every other generative AI

application. Investors that caught it

early made lifechanging returns. And

they caught it early by understanding

the science behind the stocks. Nvidia

more than 12xed in size because their

GPUs were perfect for training and

running AI models since they could make

trillions of calculations per second.

They're insanely fast and insanely power

efficient, which meant the rest of the

data center had trouble keeping up.

Normal fans couldn't keep the hardware

cool enough. Normal networks couldn't

move data fast enough. And normal memory

couldn't feed the GPUs fast enough. So,

the GPUs sat idle, burning cash instead

of generating tokens. And the AI race

quickly shifted from who had the fastest

chips to who had the data center

infrastructure fast enough to feed them.

And in many ways, Wall Street still

hasn't figured that out. This is why the

hyperscalers, Amazon, Microsoft, Google,

and Meta platforms are on track to spend

well over a trillion dollars on AI

infrastructure in 2025 and 2026 alone.

The GPUs, the cooling, the networks, and

the memory. But while we could invest in

the market leaders for data center,

GPUs, cooling, and networking, there was

no easy way for most US investors to buy

shares of the market leader for high

bandwidth memory until this summer.

There are three major players in the

high bandwidth memory market. SKH

Highix, Samsung, and Micron. Of the

three, only Micron was listed on US

exchanges. So, that's the one I covered

and invested in. But it turns out that

SKHX dominates the HBM market with a 50%

share, as much as Micron and Samsung put

together. And on July 10th, they started

trading on the NASDAQ with the ticker

symbol SKHY,

raising $26.5 billion in what became the

largest US IPO by a foreign company in

stock market history. According to their

IPO filing, they'll use that money to

fund new fabs and EUV lithography

machines. But SKHEX has been publicly

listed on the Korea exchange for almost

30 years now. They listed on the NASDAQ

as an American depository share or ADR

the same way TSMC and Alibaba list on

the New York Stock Exchange. Each ADR

represents onetenth of a Korean common

share. The problem is each ADR costs a

lot more than that. Let me show you what

I mean. If you Google SKHY right now,

you'll see that Skhinx trades at around

a $920 billion market cap. That number

comes from its price on the Korea Stock

Exchange since that's where almost all

of the shares actually trade. Skinx has

$729 million shares outstanding, which

works out to about $1,260

per share or $126 per ADR, but the ADR

currently goes for $175.

Same company, same shares, but US

investors are paying a 40% premium to

buy it on the NASDAQ. Set another way,

SKHEX is worth $920 billion on the Korea

exchange, but $1.3 trillion on the

NASDAQ. I wanted to make sure I wasn't

crazy for buying other ADRs, so I

checked them out, too. Alibaba trades at

the same price in Hong Kong and in New

York since they can freely convert

shares to ADRs and back. Taiwan

semiconductor trades at a 12% premium

because Taiwan will only issue new ADRs

when the old ones get cancelled. So

there's limited supply and SKHEX has an

even tighter limit on their supply since

only 2.5% of the company can become ADRs

in the first place which is part of the

reason it has such a high premium. If

SKHEX ever lets more ADRs exist, this

premium should fall accordingly and so

should the price. But that raises the

obvious question. Is SKH Highix actually

worth buying at a 40% premium? By the

way, if you've ever tried comparing

stocks like SKH Highix, Micron, and

SanDisk head-to-head, you know it can

eat your whole weekend, pulling all the

numbers, building the spreadsheet, and

tracking it after. Or you can hand it

off to GenSpark, the all-in-one AI

workspace sponsoring this video. I gave

its super agent a single prompt. compare

these three companies on valuation,

growth, margins, and HBM market share.

Then a few minutes later, it handed me a

side-by-side breakdown that would have

taken me hours to build myself. It even

included all its sources. Then I dropped

that into Agent Base and had it build a

live dashboard that color codes the

winner for every metric so I can see

who's ahead at a glance. But here's the

best part. I saved that whole process as

a skill. So now it can rerun on its own

and it emails me the moment there's a

clear winner with a link straight to the

dashboard. And right now you can try

GenSpark with free credits when you sign

up with my link below. All right. In

order to decide if SKH's ADR is actually

worth buying at a 40% premium, we need

to understand the science behind this

stock. The most common mistake investors

make is assuming SKHENX is a pure play

HBM company when they're actually a

full-line memory chipmaker. Skhinx

splits their business into two major

categories. The first is DRAM, the

fastworking memory a computer uses to

hold data that it's actively processing.

The second is NAND flash, the storage

that holds your data even when the power

is off. In the most recent quarter,

SKHENX's DRAM segment brought in about

73% of their total revenue and Nan flash

brought in 27% while non-memory products

and foundry services accounted for less

than 1%. High bandwidth memory falls

under DRAM. This is the specialized

stacked memory that sits next to every

AI chip and feeds it data fast enough so

that it doesn't sit idle. And this is

what most investors focus on since it's

where a lot of the growth and margins

come from. But this segment also

includes conventional DRAM. The server

memory in data centers, the memory in

your smartphone and the memory on your

graphics card. This part is priced much

more like a commodity. Rising and

falling with the industry's normal

supply and demand cycles. Then there's

NAND flash, which is basically data

storage. SKHNX's headline products here

are their enterprisegrade solid-state

drives for data centers. The kind of

highdensity storage that AI buildout

can't get enough of. A big piece of that

business comes from Solidime, the SSD

business that SKHix bought from Intel

for $9 billion. Solid specializes in

storage density. Their flagship drive

holds 122 tab in a single unit and AI

data centers buy them by the rack to

hold training data. As a result, SKH is

now the second biggest enterprise SSD

supplier in the world, only behind

Samsung. Every model that gets trained,

every data set that gets stored, and

every system checkpoint gets saved

somewhere on NAND flash. That's why the

enterprise SSD market more than doubled

in size in a single quarter. SKH's NAND

revenue more than quadrupled

year-over-year thanks to higher prices

and higher sales volumes. So, these

drives really are a second AI hardware

business hiding in plain sight. As a

result, their total revenues came in at

79 trillion Juan or about 55 billion for

the quarter, which is up $257%

year-over-year. Here's how I've been

thinking about SKHENX after reading

through their IPO filings and their

latest earnings. Their NAND flash

business is 60% bigger than SanDisk's

entire company, even though that's all

SanDisk makes. and their DRAM business

which includes HBM is about 25% bigger

than Microns. Like I said earlier, about

half of every dollar spent on high

bandwidth memory goes to SKH Highix

today. But you should know that that's

down from a 64% market share this time

last year since Samsung was actually

first to mass-produce HBM4, which caused

Samsung's market share to jump from 21%

to 33% in a single quarter. Either way,

SKH Highix is the second biggest global

supplier of DRAM and NAN storage

overall. So, investing in them means

owning the entire memory layer of the AI

revolution. Another common mistake

investors make is assuming memory is

still a cyclical low margin business.

Before the AI era, memory makers didn't

set their prices. The entire computing

industry set them based on supply and

demand. When demand outruns supply,

prices and margins spike. But when

supply outruns demand, they both

collapse. So memory makers lived and

died by how well they could predict

demand and how much of that demand they

could fill without going over. Case in

point, SKH posted an operating loss of

about $5.9 billion back in 2023, which

was the last major downcycle for memory.

But watch how fast that formula flips

when demand grows much faster than

supply, which is exactly what's

happening in the AI era today. Last

quarter, SKHEX made 79 trillion1 in

revenue and 65 trillion of that was

operating profit. In dollars, that's

roughly 55 billion in revenue and 42

billion in operating profit, which works

out to an operating margin of 76%.

The highest in the company's history.

Those are the kinds of numbers we

usually see at Silicon Valley software

startups, not 43-year-old hardware

companies. Now, let me tell you

something that will put you ahead of

almost every Wall Street analyst

covering this stock. Conventional DRAM

prices still move with the normal

commodity cycle, but high bandwidth

memory is different. It's built for a

specific customer specs and sold on

pre-negotiated agreements. So, the

number of chips and the price get

settled before the chips are ever even

made. So, high bandwidth memory is

priced less like a component and more

like a major enterprise contract. Think

about what that means for the risks we

just talked about. A commodity company

can't predict what their products will

sell for for more than a year out. But

this year, SKH signed contracts with

about 10 major customers that lock in

volume and pricing terms for 5 years or

more. And they all require deposits

upfront. As contracts make up more and

more of their revenues, Skhinx grows

their sales, their operating margins,

and they also become much more

predictable, which shareholders love

because it lowers their overall risks.

But contracts can cut both ways. Last

quarter, memory prices jumped between 30

and 60%. And SKHEX had more of its

revenue locked into fixedpric contracts

than Samsung or Micron. So they captured

less of that growth as upside which is

why they missed Wall Street's

expectations for operating profits and

the stock fell close to 10% even though

they reported record earnings. The same

contracts that protect memory companies

when prices fall can also cost them some

of the upside when memory prices rise.

That's the price for long-term

predictability. But hyperscalers aren't

just buying memory. They're knocking

down the doors. On their latest earnings

call, Skhinik said that their HBM,

DRAMM, and NAND capacity will stay tight

because new fabs take years to come

online. Micron said the same thing on

their earnings call. And Nvidia's

earnings showed that their purchase

commitments more than doubled from $119

billion to $279 billion in a single

quarter, primarily to lock in memory

supplies. So, let's talk about why

memory supplies are so tight in the

first place. Like I said earlier, modern

AI processors are so fast that they end

up spending a significant portion of

their time waiting for data to arrive

from memory. If the GPU is the engine of

AI, then high bandwidth memory is the

fuel line. It may not be obvious by

looking at me, but I'm not actually a

car guy. Oh, what's that? It's actually

extremely obvious. Well, stick with me

anyway. If the GPU is the engine, then

HPM is the fuel line and data is the

fuel. If the fuel line is too narrow, it

doesn't matter how fast the engine can

go. It will constantly be waiting for

more fuel. So, what determines a GPU's

real performance, which is how much math

it actually does per dollar or per watt

when it's inside a real data center, is

how fast you can feed it that data. That

doesn't just mean higher memory

bandwidth. It also means more power

efficiency and better cooling. If we

look at their road map, SKH started

shipping HBM4 in volume last quarter and

in June they shipped samples of their

next generation HBM4 memory to major

customers. Each stack holds 48 GB across

12 layers of memory running at up to 16

Gbits per second per pin, which works

out to about 4 tab per second of

bandwidth per stack. or said in English,

that's enough bandwidth to transfer

around 300 fulllength 4K movies to the

GPU every single second. If the GPU is

the engine, then HBM4E

is a massive fuel line. On top of that,

it's over 20% more power efficient and

has 17% better heat resistance than the

previous generation, so it runs cleaner

and gets less hot. See, maybe I'm a car

guy after all. Here's why the supply

constraints won't go away overnight.

High bandwidth memory takes about three

times the wafers to make compared to

standard memory. Process yields are

lower. It takes four to 5 years to build

the specialized fabs needed to make it

in the first place. And unlike software,

you can't just patch in new updates

every few days. Another thing to

consider is that SKH is a fully

integrated memory manufacturer. They own

and operate their own factories and they

do their own wafer fabrication. They

also do their own packaging and testing

end to end. They even stack and bond the

DRAM dies into finished high bandwidth

memory cubes before TSMC mounts them

next to Nvidia's GPUs. And SKH Highix

just broke ground on their first

packaging plant in the United States

with production slated to start in 2029.

So memory will be supply constrained for

years to come. Because not only does

each generation of HBM need to keep up

with current GPU and network speeds, but

the designs, the factories, and the

fabrication process all need to be set

up and coordinated years in advance.

Speaking of years in advance, there's

another part of their initial SEC filing

that I want to highlight. On June 7th,

Nvidia and SKH Highix announced a

multi-year partnership to co-develop

next generation memory built around

Nvidia's AI roadmap spanning four of

their next generation platforms. Vera

Rubin AI supercomputers, the Vera CPUs,

RTX Spark PCs, and even Jetsenthor for

robotics. 6 weeks later, they also

signed a letter of intent on a

partnership around memory supplies and

AI factories. That partnership is valued

at over $500 billion. The first Vera

Rubin AI factory powered by SKHEX's HBM4

is planned for 2027. And even though

Nvidia qualified all three memory makers

for Vera Rubin, SKH is expected to

supply about 2/3 of the HBM4 for it this

year. Here's a funny story from Computex

2026 in Taiwan. Jensen Hang walked up to

an HBM4E wafer at the SKH Heinix booth,

wrote, "Please make more on it," and

signed it. "Whenever I try to do that, I

just get escorted out by security." The

thing is, this isn't just a vendor

filling purchase orders. Vendors can be

swapped out on price. This is a

long-term co-development partnership

where Nvidia designs their chips around

what next generation memory can deliver.

And SKHX's memory gets designed for

Nvidia's road map years before the chips

even ship. So SKHEX isn't waiting for

Nvidia to hand them a spec sheet.

They're helping write it. All right, now

that you understand the company, let's

talk about the stock, the valuation, and

the risks. And if you feel I've earned

it, consider hitting the like button and

subscribing to the channel. that really

helps and it lets me know to make more

deep dives like this. Thanks. Now, let's

talk about SKH High stock. I think the

best way to analyze their valuation is

by comparing it to stocks we already

know like Micron for DRAM and SanDisk

for storage. Here's a table summarizing

everything I've covered. I built it by

pulling numbers from each company's

latest earnings and I'm showing Skhinx

twice because the ADR price is

significantly different from their price

on the Korea exchange. I tried to make

each row as apples to apples as I could.

But all three companies have different

fiscal years, different customers, and

SKHIX reports their numbers in the South

Korean one. So the numbers might change

a little based on the conversion rate.

So treat this as a good way to compare

these companies, but not as official

audited numbers. Let's start with their

size. Micron is worth a trillion and

SanDisk is worth around a quarter of

that. SKH Highix is worth $920 billion

on the Korea exchange and 1.3 trillion

when you buy the ADR on the NASDAQ. All

three companies are growing revenues

extremely fast. SanDisk is up 372%

year-over-year. Micron is up 346%

and SKH is up 257%.

SKHX isn't really growing slower than

the other two. They're just growing from

the biggest revenue base. And all three

companies have operating margins that

would embarrass most software companies.

80% for Micron, 78% for SanDisk, and 76%

for SKH Highix. But here's where things

get interesting. Back in 2018, SKHix put

about $3.5 billion into Kioia, a

Japanese NAND flash memory maker spun

out of Toshiba. Kioxia's stock

skyrocketed this past spring. So SKHix

had to report a $45 billion gain, which

inflates their net profits. I removed it

since that's a one-time gain that has

nothing to do with selling memory chips,

which is why my table shows SKH trading

at around 12 times earnings and the ADR

trading at around 16 times earnings.

That's still less than Micron and

SanDisk, which have price toearnings

ratios above 20. And when it comes to

their forward PE ratio, meaning what

analysts expect them to earn over the

next 12 months, SanDisk trades at a 7.3

and Micron trades at a 6.8. Skhinx

trades at a 4.2 on the Korea exchange.

And even with the 40% premium for the

NASDAQ listed ADR, it still trades at a

5.8. That's about a 15% discount to

Micron even after the ADR's premium. All

right. So, is SKH Highix worth buying?

Even with the ADR trading at a big

premium, SKHX is the clear leader when

it comes to high bandwidth memory, and

their enterprise storage business is a

second stream of AI revenues that Wall

Street is still ignoring. On top of

that, they have 76% operating margins on

hardware that will stay supply

constrained for years to come, and

they're co-developing their next

generation of memory with Nvidia. All

while their stock trades cheaper than

Micron and SanDisk even after that 40%

premium. In fact, the company itself is

spending 40 trillion Juan or $29 billion

buying back its own shares after calling

them undervalued in a recent SEC filing.

Just to be clear, they were talking

about the Korean shares, not the ADR.

And that 40% premium is only because

2.5% of the company's shares can be ADRs

at once. If that number grows, the

premium shrinks, which means the price

of the ADR would likely fall to close

that gap. So, make sure you keep that in

mind. In my opinion, if you have any way

to buy the shares directly, that's the

way to go. For example, Interactive

Brokers has offered the stock itself

since May. Otherwise, the ADR is

actually still fairly cheap relative to

the other memory makers. You just need

to be ready for the price to drop if

SKHENX issues more ADRs. The rest of the

risks are ones we've already covered.

Samsung caught up on HBM4 production and

is taking meaningful market share.

Long-term contracts protect SKHNX from

falling memory prices, but they also cap

their upside when memory prices rise.

And every memory stock on my table is

priced around 75% margins. So, if

margins start to fall, prices might fall

with them. But based on everything I've

learned and everything I've covered in

this video, I think SKH Highix is

currently a great way to get rich

without getting lucky. And if you want

to see even more stocks I'm buying to

get rich without getting lucky, check

out this video next. Either way, thanks

for watching and until next time, this

is Tickerol U. My name is Alex,

reminding you that the best investment

you can make is in you.