ASML Stock Performance and Market Position - ASML stock has shown strong performance, rallying +24.4% after a -13.4% pullback to $850s in early May 2024, and is currently trading at +6.6% compared to the wider market at +6.2% [1] - The stock is retesting its all-time high of $1.06Ks, moving away from its 50/100/200 day moving averages [3] - ASML is considered a linchpin in the semiconductor industry, benefiting from the generative AI boom and semiconductor nationalism post-COVID-19 [6] Revenue and Capacity Expansion - ASML's management raised FY2025 revenue guidance to the upper half of €30B to €40B, with adjusted gross margins up to 56%, compared to previous guidance of €24B to €30B in 2021 and €30B to €40B in 2022 [4] - The company plans to significantly expand production capacity by 2025/2026, with DUV units increasing to 600, low NA EUV to 90, and High NA EUV to 6 (up to 20 by 2028), compared to 2023 levels of 396, 42, and 1 units respectively [4] - ASML's capacity constraints are due to high demand, with a multi-year backlog of €38B and net bookings of €3.61B in FQ1'24 [4] Industry Trends and Demand Drivers - The semiconductor and server industries are experiencing hyper-growth, driven by the AI boom, with companies like Nvidia (NVDA) reporting FQ1'25 revenues of $26.04B (+17.8% QoQ, +262.1% YoY) and guiding FQ2'25 revenues of $28B (+7.5% QoQ, +107.4% YoY) [4] - TSMC and Super Micro Computer (SMCI) are also increasing capex and expanding manufacturing capacities to meet the growing demand for AI chips [4] - The automotive and renewable energy sectors are increasingly consuming more semiconductor chips, providing additional growth drivers for ASML [5] Valuation and Investment Outlook - ASML's forward P/E valuation has climbed to 44.57x, nearing the peak of 47x observed in November 2021 [6] - The company maintains a strong competitive moat, with no significant competition expected in the next 20 years, though Canon's nanoimprint lithography machines may pose a minimal threat in the future [6] - A fair value estimate of $769.60 is maintained based on a 1Y P/E mean of 35.55x, with a 2Y price target of $1.29K, offering a potential upside of +21.6% from current levels [6] - The stock is recommended as a Buy, with investors advised to consider dollar-cost averaging and adding positions during moderate retracements for improved margin of safety [6]

Company Performance - ASML's stock closed at $1,050.74, reflecting a -1% change from the previous day, underperforming the S&P 500 which fell by 0.25% [1] - Over the last month, ASML's shares increased by 15.08%, outperforming the Computer and Technology sector's gain of 8.85% and the S&P 500's gain of 3.59% [1] - The upcoming earnings release on July 17, 2024, is anticipated to show an EPS of $3.87, a decline of 27.93% year-over-year, with revenue expected at $6.35 billion, down 15.55% from the same quarter last year [1] Earnings Estimates - For the full year, the Zacks Consensus Estimates project earnings of $20.12 per share and revenue of $29.43 billion, reflecting changes of -6.55% and -1.25% respectively from the previous year [2] - Recent changes to analyst estimates indicate the dynamic nature of near-term business trends, with positive revisions suggesting analyst optimism about ASML's profitability [2] Valuation Metrics - ASML has a Zacks Rank of 2 (Buy), with the Zacks Consensus EPS estimate remaining unchanged over the past month [3] - The company is currently trading at a Forward P/E ratio of 52.75, which is higher than the industry average of 34.97, indicating a premium valuation [3] - ASML's PEG ratio stands at 2.24, compared to the Semiconductor Equipment - Wafer Fabrication industry's average PEG ratio of 3.5 [3] Industry Context - The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector and currently holds a Zacks Industry Rank of 194, placing it in the bottom 24% of over 250 industries [4] - The Zacks Industry Rank assesses the strength of industry groups based on the average Zacks Rank of individual stocks, with top-rated industries outperforming the bottom half by a factor of 2 to 1 [4]

When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about ASML (ASML) .ASML currently has an average brokerage recommendation (ABR) of 1.32, on a scale o ...

Wall Street loves coming up with cute little phrases, whether that be “FANG” or the more recent Magnificent 7. However, Thornburg portfolio manager Nicholas Anderson would like investors to be familiar with a new concept: targeting the best Fantastic 5 stocks for potentially blistering upside.Focused on European mega-capitalization plays, these five enterprises have delivered market-beating performance recently. We’re talking about companies with a market value exceeding $200 billion. Yet even with this tre ...

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Pixelbizz/iStock Editorial via Getty Images ASML Holding N.V.'s (NASDAQ:ASML) stock has struggled between 2022 and 2024 as the semiconductor industry entered a cyclical downturn. The following chart from Omdia shows that annual semiconductor industry revenue growth peaked in 2021 and declined to 9% year-over-year in 2023. Omdia 2024 Last year, the semiconductor industry was in a chip supply glut, which hurt many of its customers and slowed ASML's sales growth. Although some experts believe the chip industry ...

Will these two AI stocks follow Nvidia and go for a split?Stock splits are back in the spotlight after Nvidia took this step recently. Investors should remember that this is simply a cosmetic move that doesn't change the value and fundamentals of a company. What a stock split does is increase the number of outstanding shares while reducing the price of each share. So, the overall market value of the company remains the same.However, there is a belief that a stock split might increase demand for a company's ...

Nvidia's stock split is history, but investors should keep their eyes on these three AI stocks.If you've been wanting to buy Nvidia at a cheaper price, you now have the opportunity. The tech giant conducted a 10-for-1 stock split after the market close on June 7, 2024. Nvidia's share price is the lowest it's been in years.Which AI leaders could have monster stock splits on the way after Nvidia? Here are two top candidates and one definite pick.1. BroadcomIn one sense, Broadcom (AVGO 1.43%) has never split i ...

Core Viewpoint - The introduction of ASML's new High NA EUV system is expected to significantly enhance the company's financial performance in the near future, making it a potentially attractive investment opportunity [1][8]. Group 1: Financial Performance - ASML's Q1 revenue declined nearly 22% year over year to 5.3 billion euros ($5.74 billion), with a sequential drop of 27% [2]. - Equipment sales fell nearly 26% year over year to 3.97 billion euros ($4.3 billion), while service revenue decreased nearly 6% year over year to 1.32 billion euros ($1.43 billion) [2]. - The company sold 66 new lithography systems in Q1, down from 96 a year ago, and 4 used systems, unchanged from the previous year [2]. Group 2: New Technology and Customer Adoption - ASML began shipping its High NA EUV systems, with Intel being the first customer to install one in April, which is expected to enhance precision and scalability in chip manufacturing [3]. - Taiwan Semiconductor Manufacturing (TSMC) and Samsung are also set to receive shipments of the new systems by the end of the year, with TSMC expected to place significant orders related to 2nm technology starting in mid-2024 [4]. Group 3: Future Projections - ASML forecasts revenue to rise to between 30 billion to 40 billion euros ($32.4 billion to $43.2 billion) by 2025, up from 27.6 billion euros ($29.8 billion) last year [5]. - Analysts project a significant increase in earnings per share (EPS) from an estimated $20.76 this year to $32.23 in 2025, and EBITDA to rise to over $16 billion from $10.3 billion in 2024 [7]. Group 4: Valuation Metrics - ASML's stock trades at a forward price-to-earnings (P/E) multiple of about 50 times and an enterprise value (EV)-to-EBITDA multiple of 40 times [6]. - With projected increases in EPS and EBITDA, the P/E multiple could decrease to around 32 times and the EV/EBITDA multiple to about 25 times based on 2025 projections [7]. Group 5: Competitive Advantage - ASML is currently the only company producing chip manufacturing machines with High NA EUV technology, providing it with a significant technological edge over competitors [8]. - The growing demand for AI and related chips further supports ASML's market position and growth potential [8].

ASML's stock is hovering around $1,000 per share.Stock splits are back in vogue.After several years with hardly any stock splits on the market, big companies now seem to be eager to reverse course. Nvidia (NVDA -0.09%), for example, just became the fifth of the "Magnificent Seven" stocks to split its shares in less than four years, announcing a 10-for-1 stock split that's set to go into effect on June 7.Nvidia shares are up roughly 20% since the announcement, benefiting from a strong earnings report, and it ...