The stock price has halved, but analysts still predict a 130% rise—why are Kioxia bulls undeterred?

```

Kioxia's stock price has dropped by more than half in about a month, but most analysts have chosen to stay put, and some have even raised their target prices. Their reasoning is simple: fundamentals haven’t changed; what’s dropped is sentiment and technicals.

Kioxia Holdings closed at 52,110 yen (about $320) on Friday, down more than half from the historic high about a month ago. Meanwhile, according to Bloomberg data as of July 21, analysts’ average target price for the stock is 121,959 yen, which is about 130% higher than the current price.

This gap ranks first among the top 100 companies by market capitalization in the TOPIX, far exceeding Fujikura Ltd., which ranks second at 63%.

Why are the bulls unmoved?

This downturn is not an isolated event. Global AI and semiconductor stocks have generally been under pressure in recent weeks, and Kioxia has not been spared.

Specifically, two forces have contributed to this situation: first, concerns about the sustainability of AI capital expenditure and expectations that competitors’ expansion might drive down memory chip prices; second, technical selling pressure, especially spillover selling from leveraged single-stock ETFs in South Korea.

But in the face of the stock price being cut in half, most analysts’ response is: this is noise, not a signal.

Kazuyoshi Saito, Senior Analyst at Iwai Cosmo Securities, has a target price of 132,000 yen. He stated directly: "The fundamentals haven't changed at all. The company's strong profitability and growth logic, underpinned by AI demand, remain solid."

He further pointed out: "Once factors distorting supply and demand such as Korean ETFs fade away, positive catalysts like strong earnings will drive a rebound in the stock price."

Nomura Securities last Thursday raised Kioxia’s target price from 115,000 yen to 126,000 yen. Analyst Virginia Wang wrote in a report that the price of NAND flash memory may continue to rise due to supply shortages.

Yoshiharu Izumi, Senior Analyst at Philip Securities Japan, likewise maintains a target price of 143,000 yen. He believes: "Recent weakness is mainly driven by technical factors, including ETF selling overseas and leveraged bets by Japanese retail investors."

How long will the rebound take?

However, some voices warn: bullishness is bullishness, but the rebound will not happen overnight.

Ikuo Mitsui, Fund Manager at Aizawa Securities Japan, said that disturbances from factors like Korean ETF fund flows mean Kioxia may not regain upward momentum until at least the end of August. "Many investors will no longer concentrate their holdings on Kioxia, but are more likely to diversify into other stocks with attractive valuations," he said.

In other words, even if the bull logic holds, it will take time for funds to flow back.

Risk Warning and DisclaimerThe market has risks, and investment requires caution. This article does not constitute personal investment advice, nor has it taken into account an individual user’s specific investment goals, financial situation, or needs. Users should consider whether any opinions, views, or conclusions in this article are appropriate for their particular circumstances. Investment based on this is at your own risk. ```