Source: Fortune
Summary
Portfolio managers are calling the sector “memi” – a portmanteau of “memory” and “semiconductors” – as it gorges itself on the $700 billion AI buildout. The sector is led by three monster memory-chip manufacturers: Micron Technology, South Korea’s SK Hynix, and Samsung, which are each now worth $1 trillion or more in market capitalization and climbing. The memi sector is fueling growth in U.S. small-cap funds, international, and emerging market funds. However, there could come a painful return to earth if big tech companies pull back on the cash they’re spending.
Our Reading
The numbers tell one story.
Micron’s stock is up 240%, and its market capitalization stands at $1.1 trillion. SK Hynix debuted on the Nasdaq this month after raising $26.5 billion in the largest U.S. listing ever by a foreign company. Samsung is up 116% year-to-date on the Korea Exchange. The memi sector is having a real impact across the public equities market, linking parts of the market that don’t typically cavort together. The sector’s performance is unlikely to be sustainable, as the memory market is famously cyclical and subject to sharp boom-and-bust cycles.
The memory chip companies are having a real impact across the public equities market, but for how long?
Author: Evan Null
