ASML Holding (ASML)
The desk's stance
On the bench since Oct 16, 2026, on the G-Street slate.
Uncontested EUV lithography monopoly powering every advanced AI fab, but a 30x forward P/E keeps us stalking entry below $1450.
Buy below $1,450.
What the company does
Dutch company with a 100% global monopoly on EUV lithography — the school-bus-sized, $200M–$350M machines that use extreme ultraviolet light to print microscopic transistors onto silicon. Without ASML, advanced chip production stops worldwide.
Why it matters: The single deepest moat in this web. Nikon and Canon only compete in older DUV tech — for cutting-edge EUV there is no alternative on earth.
Outlook: Raised full-year 2026 guidance to a record €43–45B after a Q2 beat (€9.3B net sales). Boosting EUV production capacity ~30% per year; advanced machine backlog fully booked through 2027. With TSMC, launched the industry push to 12-inch High-NA photomasks (pilot line 2031, volume 2033) as TSMC and Samsung join Intel as High-NA adopters.
In short: Advanced photolithography semiconductor systems. Category: Monopoly Semiconductor Lithography Equipment. Sector: Technology, Semiconductor Equipment & Materials.
G-Street Value and Score
G-Street Value: $2,195.14, computed Oct 18, 2026 (confidence: medium).
How we got there: 70% analyst leg $2325.65 (4 analyst targets, credibility- and freshness-weighted, after 8% optimism discount) + 30% GainStreet factor value $1890.63 (33.8× fwd EPS anchored to semi-equipment multiples).
G-Street Score: 67 out of 100 (Medium).
- Top-line growth & guidance: 22 of 32
- Margin power: 8 of 15
- Revenue visibility & quality: 5 of 11
- Profitability & balance sheet: 20 of 24
- Capital allocation & governance: 5 of 6
- Valuation, sentiment & momentum: 7 of 12
Our current thesis
Updated Oct 18, 2026
The thesis
- Absolute monopoly in EUV lithography commands unmatched pricing power and durable customer lock-in.
- Severe lithography supply shortages through 2028 drive sustained multi-year ASP and capacity expansion.
- Installed base servicing and field upgrades deliver resilient high-margin recurring cash flows across cycles.
Risks
- Forward P/E of 29.3x trades at a sharp premium over key customer TSM at 17.9x.
- Geopolitical export controls constrain advanced tool shipments and long-term expansion in mainland China.
- Top four chipmaker customers account for approximately 61% of total net sales.
What we're watching
- Q4 2026 revenue execution against guided €14.2B–€15.2B at ~57% gross margin.
- Board decision regarding expanding 2028 EUV capacity beyond the communicated 30% increase.
- Technical support holding above $1,600 following post-earnings pullback, with resistance at $1,800.
Latest
ASML delivered record Q3 2026 revenue of €11.66B (+55% YoY) and net income of €4.96B with 57.5% gross margin, driven by surging AI tool shipments and high-margin field upgrades. Management lifted full-year 2026 revenue guidance to €44B–€45B, guided Q4 to €14.2B–€15.2B, and noted EUV capacity will lag customer demand through at least 2028. Shares trade near $1,642 (29.3x forward P/E), pulling back ~12% over two weeks post-earnings despite 11 upward EPS revisions.
Key numbers
As of Oct 16, 2026: market cap $632.7B · revenue growth +55.2% year over year · gross margin 54.3% · net margin 34.1% · forward P/E 29.3.
Analyst price targets
Published analyst targets we could trace to a named source.
- Bank of America, Buy: $2,810 target (October 2026). Source: stockanalysis.com
- Cantor Fitzgerald, Buy: $2,802 target (October 2026). Source: stockanalysis.com
- JPMorgan, Overweight: $2,350 target (October 2026). Source: price-target.com
- RBC Capital, Buy: $2,100 target (October 2026). Source: stockanalysis.com
Decision history
- Oct 16, 2026 — Moved to The bench at $1,641.52. Uncontested EUV lithography monopoly powering every advanced AI fab, but a 30x forward P/E keeps us stalking entry below $1450.
On the Gainz Lab maps
Who it does business with
- ASML Holding supplies TSMC — EUV machines (about $15.0B a year). ASML sells 100% of the advanced EUV printing machines TSMC needs to manufacture Nvidia’s chips.
- ASML Holding supplies Intel — High-NA EUV. Intel was the launch customer for ASML’s High-NA EUV machines — the tools 14A depends on, bought before TSMC committed to them.
In the Daily Brief
Named in 2 editions on 2 days.
- Oct 14, 2026: ASML delivered the goods in Europe, but our TSM still has to survive this morning's CPI tape
- Oct 13, 2026: Bank earnings went cold, leaving chipmakers to sweat tomorrow's ASML print in total silence