Core Viewpoint - ASML's market capitalization has surpassed $500 billion, driven by TSMC's higher-than-expected capital expenditures, indicating strong demand in the semiconductor industry, particularly in AI-related investments [1][2]. Group 1: Financial Performance and Market Position - TSMC's capital expenditure for 2026 is projected to be between $52 billion and $56 billion, exceeding market expectations of $46 billion, which positively impacts ASML's stock [1]. - ASML's stock has risen over 24% this month and 49% over the past year, outperforming the S&P 500 index, which increased by 15% [4]. - ASML's earnings per share (EPS) is expected to reach approximately $46 by 2027, nearly double that of 2025, reflecting strong growth momentum [2][3]. Group 2: Market Demand and Technological Advancements - ASML holds a 90% market share in advanced lithography equipment, primarily due to its unique capability to manufacture extreme ultraviolet (EUV) lithography machines [3][6]. - The demand for EUV technology is expected to grow rapidly by 2026, driven by advanced DRAM and cutting-edge logic devices, while the demand for deep ultraviolet (DUV) technology is anticipated to decline [6][7]. - ASML's high numerical aperture (High-NA) EUV systems are set to play a crucial role in the production of 2nm and below process technologies, marking a significant technological advancement in chip manufacturing [7]. Group 3: Analyst Predictions and Market Sentiment - Morgan Stanley analysts predict that ASML's stock could rise by up to 70%, potentially reaching $2,000 if profits exceed expectations and tech valuations continue to climb [2]. - The firm emphasizes that the ongoing capital expenditure cycle, particularly in the wafer foundry and memory sectors, supports their bullish outlook on ASML [2]. - ASML's service revenue has increased by 39% to €6 billion, accounting for 26% of total sales, indicating a strong growth trajectory in service offerings [3].