Tariffs have sparked a firestorm on Wall Street. U.S.-Europe trade hostility, coupled with high tariffs on China, set off a firestorm across global equities. Tech stocks were the first to bleed, and semiconductor stocks, deeply enmeshed in cross-border supply chains, also bore the brunt.
ASML Holding N.V. (ASML), the Dutch titan behind advanced chipmaking machines, sank below $600, caught in the crossfire of tariff threats, export controls, and a brewing global slowdown. Yet, a surprise 90-day tariff pause sent ASML surging. Speculators scrambled to cover shorts, recession fears eased, and whispers of softer tariffs sparked a buying frenzy. But the euphoria fizzled fast as cooling inflation failed to soothe nerves, with trade tension fears snapping a brief rally into reverse.
ASML’s rebound stalled, overshadowed by fears that global trade friction might linger longer. Relying heavily on global demand and seamless trade, ASML is vulnerable as market turbulence tests the resilience of cross-border business. Amid this whiplash of sentiment, is ASML’s plunge a red flag or an opportunity waiting to be seized?
About ASML Holding Stock
Netherlands-based ASML Holding (ASML) is a global leader in semiconductor manufacturing equipment. Specializing in lithography, metrology, and inspection systems, ASML holds a near-monopoly in cutting-edge chipmaking technology. With a market cap of $264.7 billion, it plays a critical role in advancing global semiconductor innovation and production.
Shares of ASML Holding, once lifted by the chip boom, plunged below $600 on April 7, touching a low of $578.51 – a level unseen since 2023. Down 29% over the year, hope flickered with a 15.4% surge on tariff pause news. But that rally was short-lived. Gains were swiftly pared as some viewed cooler inflation data as a darker twist - with demand softening and the economy decelerating faster than expected.
ASML stock may be nearly 40% off its $1,110 high, but it is still not in bargain bin territory - trading at 23.5x forward earnings and 7.7x sales. Even bruised, it commands a premium relative to its peers, signaling market faith in its chipmaking crown, yet a reminder that great tech does not always mean great value - at least not yet.
ASML Beats Q4 Earnings Results
ASML closed out fiscal 2024 on a strong note, dropping stellar Q4 earnings results on Jan. 29. Net sales soared 28% year over year to €9.3 billion ($10.3 billion), fueled by booming demand for its cutting-edge High NA EUV systems. Net income hit €2.7 billion ($3 billion), and EPS surged 31.5% annually to €6.84, beating expectations. Q4 net bookings landed at €7.1 billion ($7.9 billion), with EUV lithography equipment making up 42% of that haul.
Even though it sold fewer lithography systems overall in fiscal 2024, ASML still nudged full-year revenue up to €28.3 billion ($31.4 billion), thanks to strength in EUV systems and service sales.
ASML is set to announce its Q1 fiscal 2025 earnings report on Wednesday, April 16, before the market opens, and management eyes sales between €7.5 billion and €8 billion and gross margins between 52% and 53%. For fiscal 2025, management remains bullish, reaffirming full-year revenue guidance between €30 billion and €35 billion with a solid gross margin of 51% to 53%. Moreover, the company plans to keep rewarding shareholders through rising dividends and buybacks.
With a versatile lithography portfolio built to meet evolving chipmaking demands - enhancing 3D front-end integration and EUV performance - ASML is playing the long game. By 2030, it sees the potential to hit between €44 billion and €60 billion in annual sales, with margins climbing to 56% and 60% range, depending on market trends and tech adoption.
Analysts tracking ASML Holdings predict Q1 revenue to be nearly $8.7 billion, with EPS projected to climb 81.1% annually to $6.12. Looking ahead to fiscal 2025, analysts anticipate its EPS to surge by 23.1% to $25.62, and then grow by another 16.4% to $29.83 in fiscal 2026.
What Do Analysts Expect for ASML Holding Stock?
Overall, ASML has a consensus “Strong Buy” rating. Of the 24 analysts covering the stock, 19 advise a “Strong Buy,” and the remaining five give a “Hold.”
The average analyst price target for ASML is $951.62, indicating potential upside of 40%. The Street-high target price of $1,100 suggests that the stock could rally as much as 61%.
Investor sentiment cracked as tariff drama deepened. China, a vital ASML market, now looks fragile. U.S.-EU tension only sharpened the sting. The brief stock rebound was just a flicker before reality set in. But in the market’s rubble, seasoned eyes spot something else - ASML’s tech dominance may weather storms, even as short-term headwinds test every nerve.
