Nvidia and TSMC to unveil first domestic wafer for Blackwell chips, Axios reports
Investing.com -- ASML stock jumped on Wednesday after the world’s biggest supplier of computer chip-making equipment reported third-quarter results that beat analyst estimates and reaffirmed it expects to benefit from booming AI investment.
The company’s Amsterdam-listed shares surged 30% year-to-date, outperforming the broader market. But UBS analysts said they see room for further gains despite the stock’s strong run.
The bank maintains a Buy rating and has lifted its 2026 and 2027 earnings forecasts by 6% to 10%, setting a price target of €1,000 per share.
Analysts point out that ASML stock are trading at around 26 times 2027 earnings, below their 29-times historical average, while earnings are expected to compound at 16% between 2025 and 2030.
"Looking beyond 2027E, we anticipate that High NA adoption could bolster valuation multiples, potentially unlocking additional upside," a team led by Francois-Xavier Bouvignies wrote.
UBS flags High NA EUV as a catalyst for re-rating, even though no orders were booked in the last quarter. Analysts say visibility on adoption should improve after the SPIE conference in February, and note that while no High NA orders were recorded this quarter, they remain “key to our thesis.”
Analysts cite accelerating demand tied to AI deployment in memory and advanced logic as the key driver and describe the setup as a “trajectory toward €1,000/share.”
ASML management has signalled that 2026 revenues should not fall below 2025 levels, supported by stronger EUV momentum at leading customers like TSMC and a rebound in DRAM spending.
UBS now expects tool sales to TSMC to grow in the mid-single digits next year, compared with a previous forecast for a 5% decline, and sees Memory-related revenue rising 25% as DRAM wafer fab equipment spend increases.
The analysts also note that China risk is becoming more manageable, with revenues from the region expected to normalise after a period of elevated spending. While total DUV revenue is projected to fall 5% year-on-year in 2026, non-China demand is seen growing 18%, driven by advanced logic and memory customers.