Dan Ives, a leading technology analyst at Yorkville Capital, stated that "semiconductors from Samsung Electronics and SK Hynix play a crucial role in artificial intelligence (AI), akin to the heart and lungs. Given that the AI boom is still in its infancy and the narrative around China's semiconductor ambitions is largely fictional, the Korean stock market is significantly undervalued."
Speaking at a press conference on October 14 in Seoul, Ives emphasized that "investors on Wall Street continue to underestimate the role of Korean companies that are pivotal in the AI industry." He noted, "From a professional perspective, having monitored the big tech sector for decades, Korea resembles Silicon Valley in the mid-1990s. With its leadership in semiconductors, agents, energy infrastructure, and physical AI, Korea is poised to attract global investors' attention in due time."
Yorkville Capital, a U.S. financial firm, combines corporate finance services with direct investments. Launched in July, it leverages the expertise of Ives, who has a long history as a technology analyst on Wall Street, focusing on sectors such as AI, energy, and infrastructure. The firm is particularly interested in Korea's diverse AI value chains amid the ongoing U.S.-China competition.
Ives addressed the decoupling of performance and stock prices for Samsung and SK Hynix, attributing it to experts focusing solely on the memory semiconductor investment cycle. He predicted a supply shortage in memory chips until 2029, suggesting a "supercycle" lasting 12 to 18 months. He also forecasted a gradual rise in stock prices for both companies, stating that the KOSPI index would recover to its previous peak of around 9,000 within a year.
In response to global investors' concerns that Chinese semiconductor companies are undermining Korean competitiveness, Ives dismissed these claims as "nonsense." He described market fears regarding the technological advancements of China's ChangXin Memory Technologies (CXMT) as "a narrative based on fiction," asserting that Samsung and SK Hynix are at least three years ahead of their Chinese competitors.
Ives explained that the fourth industrial revolution driven by AI is only about 15% complete. He likened the development of AI to building a city in the desert, stating, "The monumental shift that AI represents is just beginning. Throughout this process, doubts regarding capital investment, infrastructure expansion, corporate trial and error, the impact of China's deep tech, and the sustainability of AI capital expenditures will persist, serving as speed bumps in the evolution of a new economy."
He added, "If the party started at 9:30 PM, we have just passed midnight. As always, bears watch the party from outside, while only the brave bulls who recognize opportunities at the bottom can enjoy it. If bears and bulls meet at 6 AM, the bulls will likely recount a much more enjoyable time." He cautioned that during the party, there will be moments when the music stops, cups break, and police arrive.
Ives identified global big tech companies' capital expenditures as a key factor supporting the strength of tech stocks. He explained that hyperscalers like Microsoft, Amazon, and Google are investing heavily in AI data centers, semiconductors, and power infrastructure, which will have a ripple effect across related industries.
He projected that capital expenditures from hyperscalers could reach $3 trillion to $4 trillion in the coming years. Once the AI industry enters a significant monetization phase, he anticipates that major U.S. tech stocks could rise by an average of 30%, with the Nasdaq index potentially reaching 35,000 by 2029.
For 2027, Ives highlighted leading AI market players such as Nvidia, Microsoft, Palantir, Apple, and CrowdStrike. In Korea, he pointed to Hyundai Motor, which has strengths in physical AI and autonomous driving, and Hanwha Group, which is expected to benefit from the integration of defense and AI. He concluded, "The AI revolution is creating new investment opportunities across various industries, and I am committed to helping companies and investors uncover gem-like opportunities in the growth of the global AI industry."
* This article has been translated by AI.
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