TLDR
- ASML shares surged 7% Thursday, breaking through $500 billion market capitalization
- TSMC’s 35% earnings jump to $16.3 billion triggered the semiconductor rally
- Stock reached all-time high of €1,167 per share during trading session
- RBC Capital initiated with Outperform rating and $1,550 price target
- Analysts point to AI demand, EUV lithography growth, and tight DRAM as catalysts
ASML achieved a major milestone Thursday by crossing the $500 billion market cap threshold. The Dutch semiconductor equipment maker watched shares climb over 7% to new records.
TSMC’s quarterly results provided the spark. Taiwan Semiconductor posted net income of $16.3 billion, up 35% from last year and beating analyst forecasts.
Shares touched €1,167 during the session. ASML’s market value reached roughly 443 billion euros, equivalent to $515 billion.
The company maintains its crown as Europe’s largest public company by market cap. The gap between ASML and other European firms continues widening.
TSMC relies on ASML’s advanced photolithography machines for chip production. The partnership means good news for one typically translates to gains for the other.
European semiconductor stocks posted broad gains following TSMC’s announcement. The entire sector caught a bid from the positive results.
Wall Street Raises Expectations
RBC Capital started coverage on ASML Wednesday with bullish expectations. The firm assigned an Outperform rating alongside a $1,550 price target.
Current trading around $1,264 means RBC sees meaningful upside ahead. The analysts identified multiple tailwinds supporting their thesis.
Spending on wafer fab equipment is trending higher. Extreme ultraviolet lithography adoption continues accelerating across the industry.
RBC projects these trends extending into 2026 and 2027. Demand for generative AI chips is driving equipment purchases.
DRAM supply remains exceptionally tight worldwide. EUV intensity in chip production keeps increasing. Samsung potentially rebounding in HBM4 memory adds another positive factor.
Logic chip makers are transitioning to more advanced manufacturing nodes for AI accelerators. Competition among foundries is intensifying again.
Performance and Valuation
ASML posted 73.91% total returns over the trailing twelve months. The past six months alone saw gains of 58.02%.
The stock currently carries a P/E ratio of 44.75. Wall Street price targets span from $843.92 to $1,520.48.
RBC observed ASML’s valuation gap versus American peers has narrowed. The firm interprets this as an opportunity for investors.
Concerns about China appear reflected in current pricing. The services segment should maintain double-digit growth rates.
ASML occupies a critical position in global chip manufacturing. No competitor offers equivalent EUV lithography technology. The company essentially has a monopoly on essential equipment.
The stock outpaced the SOX semiconductor index during 2025. ASML held up better than many chip names during market volatility.
Guidance Fuels Optimism
TSMC didn’t stop at beating estimates. The company issued encouraging guidance for future quarters.
That forward outlook reassured investors about sustained demand patterns. Buyers jumped into ASML shares on the confidence boost.
Shares were trading up around 5% by mid-morning GMT. The stock pulled back slightly from intraday highs but held strong gains.
The $500 billion milestone carries symbolic weight. It underscores ASML’s dominance in semiconductor equipment manufacturing.
European markets celebrated the achievement. ASML’s success lifts the entire European technology sector’s profile.
The rally spread enthusiasm across chip equipment makers. Investors rotated into the sector expecting more positive results ahead.
TSMC’s strong performance validates the AI chip boom thesis. Data center buildouts continue driving unprecedented semiconductor demand.
