Key Takeaways
- Bernstein’s Stacy Rasgon highlighted unrelenting AI chip demand, triggering a 5.1% rally in ASML shares
- Though Rasgon’s analysis didn’t explicitly mention ASML, market participants quickly linked the implications to the lithography equipment leader
- Bank of America maintained its Buy recommendation with a €1,598 price objective following discussions with Asian investors
- BofA identifies ASML as a “prime beneficiary” of expanding EUV technology adoption and increased memory sector capital expenditures
- BofA’s 2028 revenue projection of €52 billion appears conservative; the firm anticipates a capital markets day announcement this year
ASML Holding experienced a sharp rally exceeding 5% on Monday following two independently bullish research reports that refocused investor attention on the semiconductor equipment manufacturer.
The momentum began with research commentary from Stacy Rasgon at Bernstein. While his analysis didn’t explicitly reference ASML, market participants quickly connected the implications.
Rasgon’s research concentrated on the wider artificial intelligence semiconductor sector, maintaining that demand “currently shows no signs of slowing” despite this year’s correction in AI-related equities.
He spotlighted Broadcom (AVGO) as particularly compelling, projecting the company could multiply its 2025 earnings fourfold to exceed $20 per share. Nvidia (NVDA) could see earnings expansion from below $5 last year to $12 or higher by 2027. ASML shares were changing hands near $1,369 during trading hours, representing approximately a 3.9% intraday advance.
The Supply Chain Connection: Why ASML Wins When AI Chips Win
The relationship is straightforward: accelerating AI chip demand translates to higher revenues for semiconductor designers like Nvidia and Broadcom. This demand cascades to foundries such as TSMC, which must expand manufacturing capabilities. Capacity expansion requires purchasing additional equipment — specifically ASML’s advanced lithography systems.
Rasgon additionally pointed to persistent supply constraints stemming from inadequate chip manufacturing capacity. This environment creates sustained demand for ASML’s specialized lithography tools.
ASML’s current valuation multiples aren’t inexpensive at 46.5 times trailing twelve-month earnings. However, Wall Street forecasts 19% compound annual earnings growth over the coming five years, and if Rasgon’s AI demand narrative proves accurate, that expansion trajectory could validate current pricing levels.
Bank of America Projects Strength Extending Through 2027
In a separate research publication, Bank of America analyst Didier Scemama shared findings following investor consultations throughout Asia.
His central conclusion: the memory semiconductor cycle is “likely to remain strong through at least 1H27E.” This outlook underpins ASML’s order pipeline well into the following year.
BofA outlined three primary growth drivers. First, high-NA EUV technology adoption is projected for 2028, spearheaded by TSMC and SK Hynix. Equipment availability reached 80% by year-end 2025 and is forecast to hit 90% by the close of 2026. Scemama’s model incorporates 15 high-NA system deliveries in 2028.
Second, low-NA EUV capacity constraints are anticipated by Q4 2027, with 22 system shipments expected that year. BofA believes ASML may announce expanded EUV production capacity during 2026.
Third, BofA anticipates ASML will conduct a capital markets day presentation later this year and suggests 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 revenues and characterizes this figure as “increasingly conservative” relative to Street consensus.
Bank of America reiterated its Buy rating with an unchanged price objective of €1,598, designating ASML as its preferred holding in the semiconductor equipment sector.
