ASML Holding N.V. (ASML): A Bull Case Theory

Core Thesis - ASML Holding N.V. is positioned to benefit from its strategic €1.3 billion investment in Mistral AI, enhancing its role in the AI ecosystem while maintaining its leadership in semiconductor technology [2][4]. Investment Highlights - ASML's share price was $1,002.30 as of October 7th, with trailing and forward P/E ratios of 36.49 and 34.01 respectively [1]. - The investment in Mistral AI makes ASML the largest shareholder, indicating a significant commitment beyond a passive stake [2]. - This strategic move could redefine ASML's stock narrative, shifting from a cyclical semiconductor focus to a sustainable growth trajectory linked to AI innovation [3]. Market Implications - The intersection of AI and semiconductor technologies may create new revenue streams and applications, potentially leading to a rerating of ASML's valuation [3][4]. - ASML's involvement in the AI landscape could reinforce its technological moat and provide a first-mover advantage in integrating semiconductors with AI applications [4]. Historical Context - ASML's stock has appreciated approximately 34% since a previous bullish thesis in May 2025, which highlighted its leadership in EUV lithography and strong gross margins [5]. - The company is not among the 30 most popular stocks among hedge funds, with 78 hedge fund portfolios holding ASML at the end of Q2, down from 80 in the previous quarter [6].