Market Overview - U.S. stocks are expected to have a volatile start in 2026, while European markets are performing strongly, with the STOXX 600 index up over 4% year-to-date compared to the S&P 500's flat performance [1] - European governments are increasing spending and anticipating economic growth, which may lead to U.S. stocks lagging behind their European counterparts [1] Leading European Stocks - Five European stocks are highlighted for their bullish trends in 2026, each with a Benzinga Edge Momentum Score of at least 90 [2] Rio Tinto - Rio Tinto has a Benzinga Edge Momentum Rating of 90.03 and is a diversified mining company focusing on iron ore, copper, aluminum, diamonds, and gold [3] - The stock has increased over 35% in the last three months, trading at 12.5 times forward earnings and 2.8 times sales, with a 4% dividend supported by a 64% payout ratio [3] ASML Holdings - ASML Holdings, rated 95.44, is a crucial technology company in Europe, known for its EUV machines that cost over $300 million each and cannot be replicated [4] - The company sells approximately 40 units annually, with a backlog exceeding a year of revenue, despite a high valuation of 43 times forward earnings and 14 times sales [5] - ASML shares are in a strong uptrend, with recent volatility helping to stabilize after a nearly 30% gain in January [6] TechnipFMC - TechnipFMC has a Benzinga Edge Momentum Rating of 92.88, with a highly anticipated Q4 2025 earnings release on February 19, following its highest EPS of $0.75 per share in over a decade reported in Q3 2025 [7] Schmid Group - Schmid Group has a Benzinga Edge Momentum Rating of 99.04 [9] Constellium - Constellium, rated 95.10, is a diversified aluminum products manufacturer with a market capitalization of $3 billion [9] - The company received an upgrade from Wells Fargo, raising its price target to $25, indicating over 45% upside potential [10] - CSTM shares have been trending upward since last summer, with a catalyst coming from its Q4 2025 earnings report scheduled for February 18, where analysts expect $1.9 billion in revenue and EPS of $0.32 [11]

Summary of Key Points from the Conference Call Industry Overview: EU Semiconductors Company: ASML - ASML has been upgraded to an "Outperform" rating with a price target (PT) of €1,300.00, indicating a potential upside of 32% [2][7][54] - The company is positioned as the top pick in the EU semiconductor sector for 2026, driven by significant demand for DRAM and logic chips, particularly due to AI applications [8][9] Core Insights and Arguments - **DRAM Super Cycle**: The top three DRAM manufacturers are expected to add up to 250,000 wafers per month (kwpm) of new capacity in 2026, with a shift towards the 1c node, which has a lithography intensity of 28%, significantly higher than previous nodes [2][9] - **EUV Intensity**: The transition to the 1c node will increase EUV intensity, with Samsung and Hynix deploying 6 to 7 EUV layers, while Micron will adopt EUV for the first time with 2 to 3 layers [9][12] - **Earnings Growth**: ASML's earnings per share (EPS) growth is projected at an 18% compound annual growth rate (CAGR) from 2025 to 2027, surpassing the consensus estimate of 15% [2][54] - **Valuation**: ASML is currently trading at a trough premium over its peers, with a price-to-earnings (P/E) ratio of 1x compared to a historical average of 1.6x [2][54] Company: Besi - Besi's revenue forecast for 2026 has been cut by 8%, now 10% below consensus, due to slower adoption of fluxless TCB technology for HBM4 production [3][72] - The company maintains an "Outperform" rating but has reduced its price target to €165.00, reflecting near-term downward revisions [3][72] Company: Infineon - Infineon retains an "Outperform" rating, with significant growth expected from its AI server power business, projected to double revenue from €750 million in FY25 to €1.5 billion in FY26 [4][7] - Long-term growth is anticipated to be driven by power architecture changes, with a potential market share of 30-40% and revenue reaching €5 billion by 2030 [4][7] Additional Important Insights - **China Market Dynamics**: ASML anticipates a significant decline in revenue from China in 2026, but recent trends suggest a slower decline than previously expected, driven by strong demand for advanced logic and AI chips [35][36] - **Capacity Expansion**: Advanced logic capacity in China is projected to grow sixfold over the next three years, primarily due to AI chip demand [43][44] - **Hybrid Bonding Technology**: Adoption of hybrid bonding is expected to accelerate in 2027/28, with significant growth anticipated in TSMC's capacity for 3D ICs [77][79] Conclusion The semiconductor industry, particularly in the EU, is poised for significant growth driven by advancements in DRAM and logic technologies, with ASML leading the charge. While Besi faces challenges, Infineon is well-positioned for growth in the AI sector. The dynamics in the Chinese market and the adoption of new technologies will also play crucial roles in shaping the industry's future.

Core Insights - Meta Platforms, ASML, and CrowdStrike are potential candidates for stock splits in 2026, which could enhance accessibility for average investors and serve as a positive catalyst for their stock prices [1][2]. Meta Platforms - Meta Platforms is the only stock among the "Magnificent Seven" that has never split its stock, with a current price nearing $700, suggesting a possible split in 2026 [4]. - The company aims to bolster market confidence in its significant AI infrastructure investments while reducing spending on metaverse projects, indicating a strategic shift [5]. - Meta's AI initiatives have positively impacted ad revenue, contributing to a 26% revenue increase last quarter [7]. ASML - ASML's stock price exceeds $1,000, making it a strong candidate for a stock split in 2026, with its last split occurring in April 2000 [8]. - The company holds a monopoly on extreme ultraviolet lithography (EUV), essential for advanced semiconductor chips, positioning it well for the ongoing AI boom [9]. - ASML is developing a new generation of lithography technology, High-NA EUV, which will further enhance chip manufacturing capabilities [11]. CrowdStrike - CrowdStrike's stock price is over $500, and it has never split its stock, making 2026 a potential year for a split as its annual recurring revenue (ARR) begins to accelerate [12]. - Following a significant IT outage in 2024, CrowdStrike introduced a flexible licensing model, Falcon Flex, which has improved customer engagement and led to a 23% ARR growth last quarter [14]. - The company is experiencing strong momentum with its next-generation solutions, with nearly half of its customers using six or more modules [15].

Core Viewpoint - ASML has experienced significant stock growth, rising 59% year-to-date, outperforming major semiconductor stocks and the S&P 500 [2][3]. Company Overview - ASML is a leading manufacturer of machines that produce high-end semiconductor chips, utilizing advanced extreme ultraviolet (EUV) technology, which allows for smaller and more powerful chip components [5][7]. - The company is the sole manufacturer of EUV machines, providing it with a unique competitive advantage in the semiconductor industry [7]. Financial Performance - In the third quarter, ASML reported revenue of 7.51 billion euros ($8.73 billion), a decrease of 2.2% year-over-year, with net bookings at 5.4 billion euros [8]. - The company achieved a gross profit of 3.88 billion euros, resulting in a gross margin of 51.6% and net income of 2.12 billion euros, equating to earnings of 5.49 euros per share [9]. - ASML's guidance for fourth-quarter sales is projected between 9.2 billion euros and 9.8 billion euros, with a margin of 51% to 53% [10]. Market Position - ASML's market capitalization has reached approximately $428 billion, placing it among the top 25 largest publicly traded companies globally [3]. - The stock is currently trading at an all-time high, with a current price around $1,099.47 [10]. Analyst Sentiment - Analysts are largely bullish on ASML, with JPMorgan raising its price target from $1,175 to $1,275, indicating a potential upside of 15% [11]. - Morgan Stanley also increased its price target from $1,132 to $1,161, with only one out of 42 analysts recommending a sell [12]. Future Outlook - The company is viewed as a strong candidate for a stock split as it approaches 2026, having not conducted a split since 2000 [13].

Core Viewpoint - The article discusses the potential for stock splits in 2026 for Meta Platforms, ASML, and Eli Lilly, highlighting their strong earnings growth and stock performance as key factors for these splits [3][4][13]. Meta Platforms - Meta Platforms is predicted to execute a 5-for-1 stock split in 2026, marking its first split since its IPO 14 years ago [4]. - The company has a market capitalization of $1,667 billion and a current share price of $661.53, with a gross margin of 82% [6]. - Meta's business model, driven by its family of apps, generates stable cash flow, making it resilient during economic downturns [7]. - The company is expected to replace Verizon Communications in the Dow if it proceeds with the stock split [7]. ASML - ASML is anticipated to issue a 10-for-1 stock split in 2026, with its share price currently over $1,100 and a market cap of $430 billion [8][11]. - The company holds a monopoly on extreme ultraviolet (EUV) machines essential for advanced chip fabrication, positioning it well for future earnings growth [9]. - ASML is viewed as a key player in the AI chip market, with expectations of becoming Europe's first $1 trillion company by 2035 [12]. Eli Lilly - Eli Lilly is also predicted to implement a 5-for-1 stock split in 2026, having seen its stock price surge over 600% in the last five years, reaching a market cap of $959 billion [13][17]. - The company's growth is largely attributed to its successful GLP-1 medications, with projected earnings per share of $23.69 in 2025 and $32.18 in 2026, reflecting a 35.8% increase [14]. - Eli Lilly's diverse drug portfolio and strong gross margin of 83.03% position it well for continued earnings growth, making it a prime candidate for a stock split [17].

Core Insights - ASML plays a foundational role in advancing AI by providing essential lithography machines necessary for chip manufacturing, particularly in producing advanced AI chips [4][14][17] Company Overview - ASML is the most valuable company in Europe, located in a small city in the southern Netherlands, and is not listed in the S&P 500 [4] - The company has a market capitalization of $430 billion, with a current stock price of $1,111.76 and a gross margin of 52.70% [9] Role in Semiconductor Manufacturing - ASML's extreme ultraviolet (EUV) machines are critical for producing chips with nodes below 7 nanometers, which are essential for advanced AI applications [10][12] - The company has a monopoly on the high-precision machines needed for the production of today's most advanced AI chips, making it a key player in the semiconductor industry [17] Technological Advancements - ASML's EUV machines utilize 13.5nm light for printing features with resolutions unattainable by traditional deep ultraviolet (DUV) machines, enhancing transistor density and performance [12] - The company offers different classes of NXE lithography systems designed for various chip production processes, with high-NA machines providing even greater precision [11][14] Market Position and Future Outlook - ASML is well-positioned to capitalize on the increasing demand for smaller and more powerful AI chips, as its machines are integral to the manufacturing processes of major chipmakers like Nvidia and AMD [16][20] - Approximately 27% of ASML's sales come from servicing its existing equipment, indicating a diversified revenue stream beyond just new machine sales [19] Investment Perspective - ASML is considered a "pick-and-shovel" stock for the AI era, as it benefits from the overall growth in semiconductor demand without being tied to the fortunes of specific chipmakers [2][20]

Core Insights - ASML has fully recovered from a sell-off in April, showing a year-to-date increase of 45.7%, significantly outperforming the S&P 500's 13.4% [1] Financial Performance - In Q3 2025, ASML reported net sales of 7.5 billion euros and provided guidance for Q4 sales between 9.2 billion and 9.8 billion euros, projecting around 32.5 billion euros for the full year, aligning with initial forecasts [3] - The company expects a gross margin slightly above 52% for the full year and reaffirmed its 2030 revenue goals of 44 billion to 60 billion euros with a gross margin target of 56% to 60% [4] Product Innovation - ASML's next-generation extreme ultraviolet (EUV) systems are increasingly contributing to revenue, with sales of 9 EUV machines in the latest quarter, including a high-numerical aperture system [5][6] - The average price for the 9 EUV machines sold was approximately 400 million euros each, indicating their significant impact on ASML's sales and business transformation [6] Industry Impact - EUV technology is revolutionizing chip manufacturing, enabling the production of complex designs for AI applications by using shorter wavelengths for smaller features and higher transistor density [7] - EUV is essential for producing chips with nodes below 3 nanometers, supporting the advanced chip architectures required by companies like Nvidia, Broadcom, and AMD [8] - ASML's EUV machines are critical for manufacturing sophisticated AI chips, which are becoming a larger portion of its sales, expected to enhance profit margins over time [9]

Core Insights - ASML is positioned to benefit significantly from the growth in AI chip manufacturing, making it a key player alongside other semiconductor companies like Nvidia and AMD [1][5] - ASML is the most valuable publicly traded company in Europe, with shares trading around $1,000, making it a top investment choice for those looking to invest in AI growth stocks [2] Business Segmentation - ASML's operations are divided into three main categories: servicing installed equipment, DUV device production, and EUV device production, with a growing focus on AI-related products [3] - The latest earnings report indicates that EUV devices accounted for 48% of net sales, highlighting the increasing importance of advanced chip manufacturing in ASML's revenue [4] Earnings Quality and Valuation - ASML is viewed as a reliable investment for AI chip production, benefiting from overall market growth rather than specific market share gains [5] - The company has a forward price-to-earnings (P/E) ratio of 36.3, which is considered fair given its dominant position in the advanced AI chip manufacturing equipment market [6] - Emphasis is placed on the importance of earnings quality over mere growth projections, suggesting that ASML's consistent earnings growth makes it a more stable investment compared to other high P/E stocks [7] Investment Outlook - ASML is recommended as a strong investment for those anticipating a long-term increase in demand for AI chips, as the need for advanced manufacturing technology will continue to rise [9]

Group 1: Palantir Technologies - Palantir Technologies has experienced a significant surge in demand for its AI platform, leading to a notable increase in its stock price [1] - The company's revenue and earnings growth in recent quarters has resulted in a 5x increase in stock price over the past year, with a current market cap of $385 billion [2] - The strong demand for Palantir's AI software has driven its stock performance, but it is currently trading at a high valuation multiple [8] Group 2: ASML Holding - ASML Holding is a key player in the semiconductor industry, holding a near-monopoly in extreme ultraviolet lithography (EUV) machines essential for advanced chip manufacturing [4][5] - The company reported a 40% sequential increase in net bookings to 5.5 billion euros in Q2 and expects 15% revenue growth to 32.5 billion euros by the end of 2025 [6] - ASML's revenue increased by 34% in the first half of 2025, indicating potential for stronger-than-expected performance due to robust AI infrastructure spending [7]

Core Viewpoint - The demand for AI chips is expected to positively impact ASML's future, despite its cyclical nature and recent struggles in performance [1][3]. Company Overview - ASML is a leading semiconductor equipment maker, essential for the production of advanced chips, particularly through its extreme ultraviolet lithography (EUV) technology [5][6]. - The company’s highest-end EUV machines are priced over $400 million, and clients spend billions annually on maintenance, indicating a strong dependency on ASML's products [7]. Market Dynamics - The AI chip market is projected to grow at a compound annual growth rate (CAGR) of 29% through 2030, which is expected to drive ASML's sales significantly [7]. - Major competitors in the advanced chip manufacturing space include TSMC, Samsung, and Intel, limiting ASML's client base for its most advanced equipment [8]. Financial Performance - In the first half of 2025, ASML reported revenue of €15.4 billion ($18.0 billion), a 34% increase from the same period in 2024, with a gross margin of 53.7% [10]. - The company maintained controlled growth in costs and expenses, resulting in a net income of over €4.6 billion ($5.4 billion) for the first two quarters [11]. - Despite positive first-half results, ASML's outlook for the second half of the year has become less optimistic, expecting a 15% annual net sales growth for 2025 and a decrease in gross margins to 52% [11]. Valuation and Future Outlook - ASML's current P/E ratio of 28 is at a multiyear low, suggesting potential for multiple expansion as the market for AI-ready semiconductors grows [12]. - Over the next five years, ASML is expected to outperform the market, driven by the increasing demand for AI chips and its critical role in the semiconductor supply chain [13][14].