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Investing.com - BofA Securities has raised its price target on ASML Holding NV (AS:ASML) (NASDAQ:ASML) to EUR941.00 from EUR724.00 while maintaining a Buy rating on the semiconductor equipment manufacturer. The move comes as semiconductor giant Nvidia, currently valued at over $4.27 trillion, continues to dominate the chip sector with remarkable revenue growth of 71.55% over the last twelve months.According to InvestingPro data, Nvidia maintains excellent financial health with a comprehensive score of 3.68 (GREAT), suggesting strong industry fundamentals.
The upgrade follows Nvidia’s announcement of a broad partnership with Intel that includes a $5 billion equity injection, Intel supplying custom x86 CPUs for Nvidia’s AI infrastructure portfolio, and Intel using Nvidia GPUs in future x86 PC chips.
BofA Securities believes a more competitive Intel in both datacenters and PCs should benefit semiconductor capital equipment providers like ASML, which supplies critical lithography systems used in chip manufacturing.
The firm has tentatively raised its calendar year 2027 revenue estimate for ASML from EUR35.8 billion to EUR39.2 billion and earnings per share forecast from EUR29.92 to EUR34.18, based on expectations for higher extreme ultraviolet (EUV) and high-NA unit sales to Intel and SK Hynix.
BofA Securities’ new price target is based on a 23x calendar year 2027 EV/EBITDA multiple, up from 20x previously, citing a more competitive client landscape following the Samsung/Tesla and Intel/Nvidia deals, as well as anticipated revenue acceleration in 2027 due to several new fabs opening in the US.
In other recent news, Microsoft announced the construction of what it claims will be the world’s most powerful AI datacenter in southeastern Wisconsin. Named Fairwater, the facility will feature a massive network of NVIDIA GB200s, linked by fiber optic cables. Meanwhile, Nvidia is collaborating with UK firms, including CoreWeave and Microsoft, to deploy 120,000 Blackwell GPUs in the United Kingdom by 2026, marking a significant investment in AI infrastructure.
In China, Nvidia’s new AI chip, the RTX6000D, is experiencing tepid demand due to its high cost and relatively lower performance compared to other available options. This development follows China’s directive for companies like Alibaba and ByteDance to halt purchases of certain Nvidia AI chips, which U.S. House Speaker Mike Johnson criticized as counterproductive. Despite these challenges, Nvidia continues to expand its partnerships and infrastructure projects globally.
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