Moe Sees 80% Upside for Korean Stocks on Memory Boom Expectations

Goldman Sachs strategist Timothy Moe is sticking to his bullish target for South Korean stocks, predicting an 80% upside from current levels. His estimate of a Kospi index value at 12,000 is based on the expected earnings delivery of memory chipmakers in the country.

Moe's optimism comes despite concerns over the sustainability of Big Tech's AI spending boom and rising volatility in Korean stocks. However, he believes that the global race to build data centers will drive up demand for memory and storage chips, leading to higher prices.

The US Big Tech spending is estimated to top $1.2 trillion next year, with hyperscalers continuing to invest even if they don't make a profit. This trend is expected to intensify in 2027, driving compute demand that is very memory-intensive.

Moe acknowledges risks such as competition from Chinese companies and potential political pushback against the US data-center buildout, but believes the fundamentals still favor advanced memory chipmakers for the next couple of years.