The artificial-intelligence (AI) boom has centered investor attention on chip designers like Nvidia Corporation (NVDA). But billionaire hedge fund manager Philippe Laffont is making a massive wager on a different part of the semiconductor ecosystem, the company that supplies the critical machines needed to manufacture the world’s most advanced chips.
In the first quarter, Philippe Laffont’s Coatue Management initiated a major new stake in ASML Holding N.V. (ASML), signaling growing conviction that the next phase of the AI arms race could increasingly benefit semiconductor infrastructure leaders rather than just chipmakers themselves. Coatue added 510K shares of ASML Holding valued at $655.4 million, while reducing its stake in Nvidia.
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The bullish sentiment around ASML is also gaining support on Wall Street. Analysts at UBS recently called ASML the top chip stock in Europe, highlighting the company’s dominant position in extreme ultraviolet lithography, a technology widely viewed as indispensable for producing cutting-edge AI processors. With AI-driven semiconductor spending accelerating, investors are increasingly viewing ASML as one of the most strategically important companies in the global technology supply chain.
About ASML Stock
Headquartered in Veldhoven, Netherlands, semiconductor equipment giant ASML Holding is widely regarded as one of the most critical companies in the global chip supply chain. ASML specializes in lithography systems used to manufacture advanced semiconductors, including its industry-leading extreme ultraviolet machines that are essential for producing cutting-edge AI and high-performance computing chips. ASML had a market cap of $642.2 billion, making it one of Europe’s most valuable technology companies.
ASML stock has delivered a powerful rally over the past year as investor enthusiasm around AI infrastructure and advanced semiconductor manufacturing continues to accelerate. Shares of the Dutch chip-equipment giant have surged 120.45% over the past 52 weeks, dramatically outperforming the broader market and cementing ASML’s status as one of the biggest beneficiaries of the AI spending boom. The stock is also up 52.63% year-to-date (YTD) in 2026, driven by strong demand expectations for extreme ultraviolet lithography systems that are essential for manufacturing next-generation AI chips.
Momentum in the stock intensified this week after a sharp two-day rally. ASML shares jumped 6.2% on May 20, driven by reports highlighting tightening semiconductor supply conditions and continued strength in AI-related chip demand, and UBS calling it its top European semiconductor pick. The rally extended on May 21, with the stock gaining another 2.7%.
www.barchart.com The stock seems to be trading at a premium compared to industry peers at 42.91 times forward earnings.
Stable Financial Performance
ASML Holding delivered strong first-quarter 2026 results on April 15, as booming AI infrastructure spending continued to fuel demand for advanced semiconductor manufacturing equipment. The company reported first-quarter revenue of €8.8 billion ($10.2 billion), up 13.2% year-over-year (YOY) from €7.7 billion ($8.9 billion) in the same period last year.
Net income climbed to €2.8 billion ($3.3 billion) from €2.4 billion ($2.8 billion) a year earlier, while earnings per share (EPS) rose to €7.15 from €6 in Q1 2025. Gross margin stood at 53%, compared to 54% in the prior-year quarter.
Further, ASML continued to see robust demand across its core business lines. Installed Base Management sales increased to €2.5 billion ($2.9 billion), while ASML sold 67 new lithography systems during the quarter. CEO Christophe Fouquet noted that “demand for chips is outpacing supply,” with customers increasing both short- and medium-term expectations for ASML equipment.
Meanwhile, ASML issued solid second-quarter guidance, forecasting revenue between €8.4 billion ($9.8 billion) and €9.0 billion ($10.5 billion) and gross margin between 51% and 52%. Moreover, the company raised its full-year 2026 outlook and now expects annual revenue between €36 billion ($41.8 billion) and €40 billion ($46.5 billion). ASML also projected full-year gross margin in the range of 51% to 53%, signaling continued confidence in AI-driven semiconductor capital spending despite ongoing concerns around export controls and geopolitical risks.
Also, the consensus EPS estimate of $37.10 for fiscal 2026 reflects an increase of 32.7%, while the EPS estimate of $48.06 for fiscal 2027 indicates a 29.5% rise YOY.
What Do Analysts Expect for ASML Stock?
Analysts are showing optimism around ASML’s solid exposure to memory market demand, evident as UBS reaffirmed its “Buy” rating and increased its price targets to €1,900 from €1,600.
Plus, Goldman Sachs raised its price target on ASML Holding to €1,600 from €1,570 while reiterating a “Buy” rating, citing strengthening fundamentals tied to the AI-driven semiconductor boom.
Overall, ASML has a consensus “Strong Buy” rating. Of the 28 analysts covering the stock, 22 advise a “Strong Buy,” two suggest a “Moderate Buy,” and four analysts are on the sidelines, giving it a “Hold” rating.
While the average analyst price target of $1,694.78 suggests an upside of 3.8%, the Street-high target price of $2,019 suggests that the stock could rally as much as 23.7%.
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www.barchart.com On the date of publication, Subhasree Kar did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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