r/stocks May 2, 10:01 PM
Stop calling RAM "cyclical" while treating Nvidia like a "secular grower." They are the same trade now. I keep seeing the same tired argument: 'Don't buy SK Hynix or Micron, RAM is cyclical and we’re at the top.'
First off, if RAM is cyclical, then Nvidia and TSMC are cyclical too. You can’t build a Blackwell or Vera Rubin B100/B200 cluster without massive amounts of HBM3e and HBM4. If the AI 'cycle' ends for memory, it ends for the logic chips too. You can't have a brain without a nervous system.
The Valuation Gap is Hilarious:
Nvidia and TSMC have been rallying for years and trade at massive P/E multiples. Meanwhile, the memory players only really started their 'AI' rally in earnest over the last 12-18 months.
• Fact: In Q1 2026, SK Hynix posted an operating margin of 72%. That actually beat Nvidia’s 65% margin from their last quarter.
• Fact: Memory is no longer a 'commodity' where you just buy the cheapest stick. HBM (High Bandwidth Memory) is a specialized, high-margin, custom-integrated component.
• Fact: SK Hynix and Micron are effectively sold out of HBM through 2027.
Nvidia (NVDA): ~40x P/E. People are paying $40 for every $1 of profit because they expect 'infinite growth.'
• Broadcom (AVGO): ~41x P/E.
• Micron (MU): ~7.8x P/E.
• SK Hynix: ~5.9x P/E.
SK Hynix is trading at 6 times earnings while providing the HBM4 memory that Nvidia cannot ship without.
Everyone is fine with Nvidia trading at a 40x P/E and Broadcom at 41x, calling them 'secular growth stories.' But the second you mention SK Hynix (P/E ~5.9x) or Micron (Forward P/E ~8x), people scream 'CYCICAL! SELL!'
Here’s the reality: You cannot ship a single Nvidia Blackwell or Rubin chip without High Bandwidth Memory (HBM). If Nvidia is a secular grower, so is the memory that fuels it.
So people, please stop!!!
Sk Hynix needs at least 788% stock increase to reach Nvidia PE level.
submitted by /u/SnooHedgehogs5162
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