$ASML Holding NV(ASML)$ top up around $1730, holding it for longer term investment. Will it break $2000 by end of the year? Will see!
ASML Holding (NASDAQ: ASML) — Investment Summary
ASML is one of the highest-quality companies in the semiconductor industry because it has a near-monopoly on extreme ultraviolet (EUV) lithography machines, which are essential for manufacturing the world’s most advanced chips. Customers such as TSMC, Samsung, Intel, and SK Hynix depend on ASML’s technology, and there is currently no viable competitor in EUV.
Investment thesis
Positives
* Exceptional moat: Sole supplier of EUV lithography systems.
* AI tailwind: AI data center spending is driving demand for advanced chips, boosting orders.
* Long backlog: Many advanced systems are effectively sold out through 2027.
* High profitability: Gross margins exceed 50%, with strong free cash flow generation.
* Capital allocation: Consistent share buybacks and a growing dividend.
Risks
* Rich valuation after a sharp rally.
* Semiconductor industry remains cyclical.
* Export restrictions to China could limit growth.
* AI infrastructure spending could slow if hyperscalers reduce capital expenditure.
Recent developments
ASML recently reported stronger-than-expected quarterly results and raised its 2026 revenue outlook to €43–45 billion, citing robust AI-driven demand. Management is also expanding manufacturing capacity by roughly 30% to meet customer demand.
Valuation
The stock now trades at roughly:
* Trailing P/E: ~60×
* Forward P/E: ~37–50× (depending on earnings estimates)
* Market value: Around US$680–700 billion.
This is an expensive valuation by historical standards, reflecting expectations for sustained AI-driven growth.
My assessment
Factor Rating
Business quality ⭐⭐⭐⭐⭐
Competitive moat ⭐⭐⭐⭐⭐
Growth outlook ⭐⭐⭐⭐⭐
Financial strength ⭐⭐⭐⭐⭐
Valuation ⭐⭐☆☆☆
Overall 9.5/10 business, 6.5–7/10 valuation
For a 10+ year investor, ASML remains one of the best semiconductor businesses in the world. The main question isn’t whether it’s a great company—it is—but whether today’s price already reflects much of that future growth. After its recent run-up, expected returns are likely to depend more on continued earnings growth than further expansion in its valuation multiple.
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