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Investing.com - BofA Securities has reiterated its Buy rating on ASML Inc. (NASDAQ:ASML) while raising its price target to $1,134.00 from $1,082.00, citing higher gross margin expectations and increased EUV delivery forecasts. The semiconductor equipment giant, currently trading at $983.18 and commanding a market capitalization of nearly $400 billion, maintains a "GREAT" financial health score according to InvestingPro analysis.
The firm has increased its calendar year 2025 and 2026 earnings per share estimates by 2.8% and 5.5% respectively, based on higher gross margins, lower operating expenses, and increased EUV deliveries projected for 2026 (48 units versus 44 previously forecast). The company’s current P/E ratio of 37.03 reflects market confidence in its growth trajectory, with gross profit margins standing at a robust 52.52%.
BofA Securities continues to model strong revenue growth of 17% year-over-year in 2027, following what it describes as a "largely tepid" 2026 with 3.3% growth, up from its previous estimate of a 0.6% decline. This forecast builds upon ASML’s impressive recent performance, with revenue growing 26.41% over the last twelve months. InvestingPro subscribers can access 16 additional key insights and detailed financial metrics about ASML’s growth potential.
The positive outlook is driven by foundry fab openings in the United States by TSMC and Samsung, along with EUV upgrades in DRAM at Samsung, SK Hynix, and to a lesser extent, Micron.
The firm believes ASML shares have a positive setup due to relatively modest consensus expectations for 2026 revenue growth (approximately 4%), broadening participation in AI infrastructure capital expenditure, a cyclical recovery in memory, and cautious guidance for China.
In other recent news, ASML Holding NV reported strong revenue growth for the third quarter of 2025, with net sales reaching €7.5 billion. This performance was driven by robust demand for its lithography technology, which is crucial for the production of semiconductors. Despite the positive revenue figures, the company’s stock saw a slight decline in pre-market trading. The earnings per share forecast was noted as 6.37 USD, although the actual EPS results were not disclosed in the earnings call transcript. Additionally, ASML’s Chief Financial Officer, Roger Dassen, addressed concerns about a projected drop in sales to China next year. Dassen clarified that this decline is not due to previous stockpiling by Chinese customers. These developments highlight ASML’s current financial and market position amid its ongoing push in AI-related technologies.
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