ASML has marched past Novo Nordisk to become Europe’s most valuable company, with a market capitalisation of €645 billion. The Dutch semiconductor equipment titan is now fending off unwelcome attention from Washington while Wall Street analysts race to lift their price targets on the stock.
US Commerce Secretary Howard Lutnick recently suggested that ASML may have exported its cutting-edge extreme ultraviolet (EUV) lithography systems to China in contravention of export controls. The company has forcefully denied the claim. With 314 EUV machines currently in operation worldwide — each weighing roughly 180 tonnes — ASML argues that any unauthorised transfer is virtually impossible because it monitors every unit remotely from the Netherlands.
The geopolitical noise has done little to dampen enthusiasm on Wall Street. Bank of America confirmed its buy recommendation on 22 June and raised its price target from $2,268 to $2,345, citing stronger forecasts for EUV deliveries and rising confidence in ASML’s earnings power through 2028. Wells Fargo followed suit, bumping its target from $1,750 to $2,200 while keeping an “Overweight” rating. The bank’s analysts have sharply lifted their estimates for the global wafer-fab equipment market, now projecting $190 billion in 2027 (up from $180 billion) and $216 billion in 2028 (compared with a previous $191 billion).
The stock closed on Monday at €1,691, within 1.1% of its 52-week high of €1,710 set on the same day as the BofA upgrade. The shares have surged more than 71% since the start of the year and are up 151% over the past twelve months. They trade about 52% above their 200-day moving average, signalling powerful upward momentum — though also that a great deal of optimism is already priced in. At 66, the relative strength index points to strong buying pressure without tipping into overbought territory. The stock also sits well above its 50-day line of €1,375.
Should investors sell immediately? Or is it worth buying Asml?
The rally is underpinned by ASML’s unassailable position in EUV lithography, the technology without which TSMC, Samsung and Intel cannot produce their most advanced processors. Earlier in June, ASML demonstrated its technological edge at the IEEE/JSAP Symposium in Kyoto, where it presented — together with TSMC and the nanoelectronics research centre imec — a integration route for 2D-material transistors on 300mm wafers. The EUV lithography achieved channel lengths of just 28 nanometres, compatible with the most advanced transistor nodes in production.
Yet risks remain. Washington is considering the so-called MATCH Act, which would restrict exports of older deep ultraviolet (DUV) systems — a segment that accounts for roughly one-fifth of ASML’s revenue. The company’s enormous order backlog of $45 billion provides a strong buffer against any potential shortfall from China. ASML is scheduled to report second-quarter results on 16 July, and observers expect it to confirm a full order book extending well into 2027.
For now, the market is betting that ASML’s monopoly on essential chip-making infrastructure will continue to translate into soaring profits, and that any political headwinds will prove manageable. The next few weeks will test whether that confidence is warranted.
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