🔥 Premium AI-powered Stock Picks from InvestingPro Now up to 50% OffCLAIM SALE

Top pick ASML Holdings target lifted to Street high at Bank of America

Published 2024/06/06, 12:50
© Reuters.

The ASML Holdings (ASML) price target was raised to a Street high of €1,302 at BofA, with the bank reiterating a Buy rating on the stock in a note Thursday, citing a growing confidence in €40bn revenue in 2025;

Top pick ASML is described as a "critical enabler" of the artificial intelligence (AI) infrastructure buildout.

"ASML remains irreplicable in the buildout of AI infrastructure with all AI processor and DRAM companies using EUV technology to manufacture their chips," said the bank.

BofA raised its calendar year 2025 and 2026 revenue and EPS estimates for ASML by around 6% to 9% reflecting "higher confidence in higher demand for EUV tools as well as higher GM."

"Our new CY25/26E revenue estimates are 10-7% above css while our EPS ests are 15-9% above css," they explain. "ASML remains our top pick in EU Semicaps."

The bank acknowledged that some concerns remain about foundry orders through the end of this year, but they believe that the pace of investment from all leading hyperscalers and enterprise customers in AI infrastructure leaves very little doubt that significant capacity needs to be added at the leading edge.

ASML is seen as being on track for €52 EPS in 2030, while BofA says its €65 bull case is possible.

"Assuming GM and OPEX in line with company guidance triangulates to CY30E EPS in the range of €40 (low scenario), €52 (mid) and €65 (high). At the midpoint this would imply an 11% CAGR 25-30E, justifying the current multiple of the stock," they write.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.