ASML Holding(US:ASML) INDUSTRIAL SECURITIES·2024-10-20 08:18Investment Rating - The investment rating for ASML has been downgraded to "Neutral" due to adverse factors such as headwinds in the mature process market and adjustments in key customer production plans [3]. Core Views - ASML's Q3 2024 performance exceeded expectations with revenues of €7.467 billion, a year-over-year increase of 11.9% and a quarter-over-quarter increase of 19.6%. Net profit for the same period was €2.077 billion, up 9.7% year-over-year and 31.6% quarter-over-quarter [1]. - However, the company reported a significant drop in new orders, totaling €2.633 billion, which is a 52.7% decrease quarter-over-quarter and below the consensus estimate of €5.896 billion. The total order backlog at the end of the quarter was €36 billion, down from €39 billion in the previous quarter [1][3]. - For Q4 2024, ASML provided revenue guidance of €8.8-9.2 billion, slightly above the consensus estimate of €8.751 billion [1]. Financial Summary - Revenue projections for ASML are adjusted to €28.07 billion for 2024, €31.84 billion for 2025, and €38.00 billion for 2026, reflecting a decrease from previous estimates [3]. - Net profit estimates are revised to €7.409 billion for 2024, €9.406 billion for 2025, and €11.701 billion for 2026 [3]. - The company’s gross margin is expected to be 50.5% in 2024, improving to 51.6% in 2025 and 53.3% in 2026 [3][12]. Market Data - As of October 17, 2024, ASML's closing price was $700.60, with a total share capital of 393 million shares and net assets amounting to €16.152 billion [2]. - The earnings per share (EPS) is projected to be €19.00 in 2024, increasing to €24.37 in 2025 and €30.62 in 2026 [12]. Industry Outlook - The long-term outlook remains positive due to anticipated demand for AI infrastructure and terminals, although short-term challenges persist due to slow recovery in the mature process semiconductor supply-demand relationship [3]. - Key customers, including Intel and Samsung, have announced reductions in capital expenditures, which may negatively impact ASML's performance in the near term [3].