On Monday, Bernstein increased the stock price target for ASML Holding NV (AS:ASML:NA) (NASDAQ: ASML) to EUR980.00, up from the previous EUR890.00, while keeping an Outperform rating on the shares.
The adjustment reflects the firm's confidence in ASML's sustained competitive edge and its progress with High NA Extreme Ultraviolet (EUV) technology, which is gaining traction in both memory and logic/foundry sectors.
ASML, a key player in the semiconductor equipment industry, is on track with its technological advancements and is expected to outperform its 2024 guidance. The firm's outlook for 2025 also indicates strong growth potential.
The company has seen a particularly high investment from China, capturing a significant market share in the calendar year 2023. This was partly due to China directing a higher share of its spending towards ASML's offerings.
The company's success in China has raised questions about future trends, as it's uncertain whether China will continue to allocate a higher share of its wallet to ASML. Analysts are considering whether China will balance its equipment sets by pairing ASML's tools with those from other suppliers or if the current level of investment will persist.
This is especially relevant given that China is lagging in lithography technology compared to other equipment types and may need to continue sourcing heavily from ASML.
ASML's position in the market is bolstered by its unique offerings and the adoption of its High NA EUV technology. The firm's strategic roadmap and the increasing adoption of its technology in various semiconductor segments suggest a positive outlook for the company's performance in the coming years.
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