Investing.com • Itai Smidt ASML Holds Premium Valuation as Semiconductor Capex Momentum Carries Into 2026
12/29/2025 03:51 PM • ASML trades at $1,066 with a 37.4x P/E multiple, justified by its near-monopoly in EUV lithography and strong semiconductor capex growth expected through 2026. While China revenue normalization poses a near-term headwind, core customers like TSMC, SK hynix, and Micron are projected to grow capex 18-19% in 2026, supporting mid-single-digit to low double-digit revenue growth. The stock deserves a Buy rating with 16-17% upside to fair value over 12-24 months.
ASML - ASML maintains a strong competitive moat with its near-monopoly in advanced EUV and High-NA lithography systems. Despite a premium 37.4x P/E valuation, the company is supported by robust semiconductor capex growth (11-19% for core customers in 2026), high FCF margins (27.7%), and limited competitive threats. The stock offers 16-17% upside to fair value with manageable risks.