Key Highlights
- Analyst Stacy Rasgon from Bernstein indicated AI chip demand “currently shows no signs of slowing,” boosting ASML shares by 5.1%
- While Rasgon’s analysis didn’t explicitly mention ASML, market participants quickly linked the implications to the chipmaking equipment provider
- Bank of America reaffirmed its Buy recommendation with a €1,598 price objective following investor engagements in Asia
- BofA positions ASML as a “prime beneficiary” of expanding EUV technology adoption and increased memory sector capital spending
- BofA’s 2028 revenue projection of €52 billion appears increasingly cautious; an investor day announcement is anticipated this year
ASML Holding experienced a significant rally of more than 5% Monday following encouraging analyst commentary from two prominent financial institutions that renewed investor attention on the semiconductor equipment giant.
The upward momentum began with research from Bernstein’s Stacy Rasgon. Though his analysis didn’t explicitly reference ASML, investors quickly understood the implications.
Rasgon’s commentary centered on the wider artificial intelligence chip sector, maintaining that demand “currently shows no signs of slowing” even amid this year’s volatility in AI-related equities.
He highlighted Broadcom (AVGO) as particularly promising, projecting the company could potentially multiply its 2025 earnings to exceed $20 per share. Nvidia (NVDA) could see earnings expansion from below $5 in the previous year to $12 or higher by 2027. ASML shares were changing hands near $1,369 during the session, representing approximately 3.9% daily gains.
The Connection Between AI Chip Leaders and ASML’s Business
The relationship is straightforward: increased artificial intelligence chip demand translates to higher revenue for semiconductor designers including Nvidia and Broadcom. This demand cascades to manufacturing partners like TSMC, which must boost production capabilities. Expanding manufacturing capacity requires purchasing additional equipment — specifically ASML’s advanced lithography systems.
Rasgon also highlighted persistent supply limitations stemming from inadequate chip manufacturing capacity. This environment strongly supports sustained demand for ASML’s specialized lithography technology.
ASML’s current valuation sits at 46.5 times trailing earnings, which isn’t inexpensive. However, market watchers project 19% compound annual earnings growth over the coming five years, and if Rasgon’s AI demand outlook proves accurate, such growth rates could support current valuations.
Bank of America Projects Strength Extending Through 2027
In parallel, Bank of America’s Didier Scemama released his assessment following discussions with investors throughout the Asian region.
His central conclusion: the memory semiconductor cycle will “likely to remain strong through at least 1H27E.” This outlook underpins ASML’s order pipeline extending well into the following year.
BofA identified three primary growth drivers. Initially, high-NA EUV technology adoption is projected for 2028, led by TSMC and SK Hynix. Equipment availability reached 80% at 2025’s conclusion and is forecast to hit 90% by year-end 2026. Scemama’s model incorporates 15 high-NA system deliveries in 2028.
Additionally, low-NA EUV capacity limits are anticipated by Q4 2027, with 22 system deliveries scheduled that year. BofA believes ASML may announce expanded EUV production capacity during 2026.
Finally, BofA anticipates ASML will host an investor day later this year and believes the company might elevate its 2030 revenue guidance to a range between €53.7 billion and €65.4 billion.
BofA’s current model projects €52 billion in 2028 revenue and characterizes this forecast as “increasingly conservative” relative to market consensus.
Bank of America maintained its Buy recommendation and €1,598 price objective unchanged, designating ASML as its preferred selection within the semiconductor equipment sector.
