China’s memory chip maker CXMT has potential not just in its home market, but abroad as well, analysts said. Rising memory prices and tightening industry supply globally give CXMT expansion opportunities overseas, CLSA analysts said in a report Thursday initiating coverage of the Shanghai-listed stock with an outperform rating. They said CXMT’s global market share by bit shipment could reach 14% next year, up from just 9% last year and 12% in 2026. “While still trailing the top three global suppliers, CXMT’s rapid growth underscores its accelerating market penetration and growing industry relevance.” CLSA’s valuation framework for the Chinese memory player uses TSMC as a benchmark, as it “reflects the the premium assigned to industry leaders benefitting from technology advancement, capacity expansion and sustained end-market demand, which suits CXMT as CXMT is China’s No.1 DRAM IDM [integrated device manufacturer].” They have an 84.70 yuan ($12.64) price target, up more than 60% from where shares closed Friday. The stock closed nearly 1% higher after tumbling Thursday , the first trading day following a nearly one-week long public holiday in mainland China. Ahead of the holiday, Bernstein analysts in late September initiated coverage of CXMT with an outperform rating and a 70 yuan price target. While noting the risk from U.S. restrictions to the chip company’s access to some production tools, they pointed out CXMT has still made significant progress. As for market demand, the Bernstein analysts expect foreign companies may use CXMT’s DRAM memory chips in products such as personal computers, mobile devices and consumer electronics sold outside the U.S. That gives CXMT the opportunity to capture an additional 10%-plus share of a global market just based on demand from outside China and the U.S., the Bernstein report said, citing Gartner figures. CXMT already has the opportunity to reach over 20% of the global DRAM demand with just the China market, the report said. Many of those China-made products often end up overseas. “Many assume geopolitical concerns will keep CXMT’s memory only in China,” the analysts said. “We however highlight first that Chinese OEMs [original equipment manufacturers] will install CXMT’s memory in their end products & those end products will be sold to overseas customers. Moreover, our checks also consistently find foreign PC, smartphone & consumer OEMs in general can accept the use of Chinese memory in products sold globally, likely except in the US & in sensitive segments for government or data center AI, etc.” The investor interest comes as CXMT is expected to release earnings Oct. 31 . BNP Paribas analyst Alex Chang expects the chip company’s September quarter revenue to increase 22% from the prior quarter, according to a report late last month. Samsung on Thursday projected a 13% quarter-on-quarter increase in revenue for the third quarter . However, the stock fell on the news. BNP has a neutral rating on CXMT, with a 48.70 yuan price target, as the firm believes “most of the positives are priced in.” — CNBC’s Michael Bloom contributed to this report.
