Key Takeaways
- Bernstein’s Stacy Rasgon highlighted unrelenting AI demand momentum, triggering a 5.1% surge in ASML shares
- Though Rasgon’s note didn’t explicitly mention ASML, market participants quickly linked the analysis to the equipment maker
- Bank of America maintained its Buy recommendation with a €1,598 price objective following engagements with Asian investors
- BofA positions ASML as the “prime beneficiary” of expanded EUV technology adoption and increased memory sector capital expenditure
- BofA’s 2028 revenue projection of €52 billion appears conservative; the company is anticipated to host a capital markets event this year
ASML Holding experienced a sharp 5% rally on Monday following two independent favorable analyst assessments that renewed investor attention on the semiconductor equipment giant.
The upward momentum originated with research from Bernstein analyst Stacy Rasgon. While his note didn’t explicitly reference ASML, investors quickly connected the implications.
Rasgon’s analysis concentrated on the wider AI semiconductor sector, maintaining that demand “currently shows no signs of slowing” despite this year’s pullback in AI-related equities.
He highlighted Broadcom (AVGO) as particularly promising, projecting the company could quadruple its 2025 earnings to exceed $20 per share. Nvidia (NVDA) could see earnings expansion from below $5 last year to $12 or higher by 2027. ASML stock was changing hands near $1,369 during the session, representing approximately a 3.9% gain.
The Supply Chain Connection: How ASML Profits From AI Growth
The relationship is straightforward: accelerated AI chip demand translates to higher revenues for semiconductor designers such as Nvidia and Broadcom. This demand cascades to manufacturing partners like TSMC, which must increase production capability. Capacity expansion requires purchasing additional equipment — specifically, ASML’s advanced lithography systems.
Rasgon additionally highlighted persistent supply constraints stemming from inadequate chip manufacturing capacity. These conditions create an ideal scenario where demand for ASML’s lithography technology remains robust.
While ASML’s valuation appears elevated at 46.5 times trailing earnings, analysts project 19% compound annual earnings growth over the coming five years. If Rasgon’s AI demand thesis proves accurate, that expansion trajectory could support current pricing levels.
Bank of America Projects Strong Momentum Through 2027
In a separate research note, Bank of America analyst Didier Scemama shared insights following investor discussions throughout Asia.
His primary conclusion: the memory semiconductor cycle is “likely to remain strong through at least 1H27E.” This outlook underpins ASML’s order pipeline extending well into the following year.
BofA identified three significant growth drivers. First, high-NA EUV technology adoption is projected for 2028, led by TSMC and SK Hynix. Tool availability reached 80% by late 2025 and should hit 90% by the conclusion of 2026. Scemama forecasts 15 high-NA tool shipments in 2028.
Second, low-NA EUV capacity constraints are expected by Q4 2027, with 22 tool deliveries scheduled that year. BofA anticipates ASML may announce expanded EUV production capacity during 2026.
Third, BofA predicts ASML will conduct a capital markets day event later this year and believes the company may increase its 2030 revenue guidance to between €53.7 billion and €65.4 billion.
BofA’s current 2028 revenue model stands at €52 billion, which the firm describes as “increasingly conservative” relative to broader market consensus.
Bank of America reiterated its Buy rating with an unchanged price objective of €1,598, designating ASML as its preferred pick within the semiconductor equipment sector.
