ASML stock price target lowered to €724 at BofA on booking concerns

Investing.com - BofA Securities has lowered its price target on ASML Holding NV (AS:ASML) (NASDAQ:ASML) to €724 from €755 while maintaining a Buy rating on the stock. The semiconductor equipment giant, currently valued at $286.6B, has seen 11 analysts revise their earnings estimates downward for the upcoming period, according to InvestingPro data.

The firm reduced its Q3 and Q4 booking estimates to €3.5 billion and €3.8 billion, down from previous forecasts of €4.6 billion and €5.4 billion, citing macro and geopolitical uncertainties affecting customer decisions. Despite these challenges, ASML maintains strong fundamentals with impressive revenue growth of 26.4% over the last twelve months.

BofA Securities noted that lack of clarity around semiconductor tariffs and weakening wafer fabrication equipment (WFE) demand in China are causing delays in ordering decisions, despite encouraging customer wins by Samsung and Intel’s recent equity funding.

The research firm pointed out that strength in artificial intelligence capital expenditure has not yet translated into WFE orders, as customers are reusing capacity for AI logic chips amid uncertainty regarding high bandwidth memory allocation.

ASML stock currently trades at 20x and 17.5x EV/EBITDA for calendar years 2026 and 2027 respectively, below its historical median multiple of 26x, which BofA Securities believes justifies its continued Buy rating despite the lower price target. InvestingPro analysis suggests ASML is currently undervalued, with a P/E ratio of 25.9x and strong financial health score of "GOOD". Discover more insights and 12 additional ProTips with an InvestingPro subscription.

In other recent news, ASML has been the subject of multiple analyst reviews following its latest earnings report. The company reported second-quarter earnings that exceeded expectations, though guidance for the third quarter was mixed. Despite this, ASML’s management reaffirmed its fiscal year 2025 targets. Deutsche Bank maintained a Buy rating on ASML but lowered its price target to €700 due to concerns about EUV shipments. JPMorgan also adjusted its price target to EUR822, maintaining an Overweight rating while expressing caution about the fiscal year 2026 outlook. Erste Group downgraded ASML from Buy to Hold, citing uncertainty in revenue growth prospects for 2026. Similarly, Freedom Broker downgraded ASML to Hold, although it kept a price target of $790. Wolfe Research, however, reiterated an Outperform rating, maintaining a positive outlook despite minor adjustments in future projections. The firm highlighted ASML’s maintained full-year guidance for 2025, projecting a 15% year-over-year growth.

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