BofA Securities has reiterated a Buy rating on ASML Inc. and left its price target at $1,672.00, preserving the company’s designation as a "Top Pick" and applying a valuation multiple of 31.0x CY27E EV/EBITDA.
ASML shares were trading at $1,413.35, close to a 52-week high of $1,419.95, and have delivered a 106.45% total return over the past year. The stock currently trades at a premium on standard metrics, with a reported price-to-earnings ratio of 49.16 and an EV/EBITDA of 37.65.
BofA’s reaffirmation follows a technical discussion with Erik Hosler, former Chief Technology Officer and Founder at xLight Inc., which reinforced the broker’s assessment that China’s domestic build-out of extreme ultraviolet - EUV - lithography faces material constraints and remains several years behind ASML’s leading edge capability.
According to BofA analyst Didier Scemama, Chinese domestic EUV development is progressing but will be hampered by a structural shortfall in global integration and deep, collaborative customer relationships that ASML maintains. That dynamic is a key reason BofA views China as a limited competitive threat for ASML’s most advanced tools.
Scemama’s note outlines how major global foundries such as Taiwan Semiconductor Manufacturing Company and Intel are unlikely to adopt unproven Chinese EUV machines. At the same time, Chinese domestic customers such as SMIC and CXMT are expected to continue acquiring a mix of ASML immersion systems alongside locally produced EUV tools, rather than fully replacing ASML equipment.
BofA also acknowledges the possibility that Chinese suppliers could win share in certain emerging markets through aggressive pricing, but the firm identifies positive industry inflection points for ASML tied to the transition toward edge artificial intelligence - a demand vector that could support future equipment cycles.
Independent of BofA’s work, other brokerages have recently offered bullish perspectives on the company. Bernstein reiterated an Outperform rating and set a $1,642 price target ahead of ASML’s earnings report scheduled for January 28. Bernstein expects results to likely top consensus, projecting revenue of EUR 9.7 billion versus a consensus estimate of EUR 9.5 billion.
Bernstein’s view is informed in part by strong import levels from China, which it reports reached EUR 3.27 billion in the fourth quarter, and by a reassessment of the company’s Deep Ultraviolet - DUV - lithography business, which Bernstein says may be an underappreciated contributor to value. Bernstein also raised its price target from $1,528 to $1,642.
RBC Capital has entered coverage with an Outperform rating and a $1,550 price target, pointing to improved wafer fab equipment spending and growth in EUV lithography as drivers of ASML’s performance. Together, these analyst actions reflect a broadly positive consensus among sell-side firms regarding ASML’s market position and technological leadership.
Market participants should note that the shares trade at elevated valuation multiples versus typical semiconductor-equipment peers, reflecting both expectations for continued leadership in EUV and the market pricing of future growth potential.
Key takeaways:
- BofA reiterates Buy and $1,672 price target, valuing ASML at 31.0x CY27E EV/EBITDA.
- Analysts view China’s domestic EUV efforts as several years behind ASML and structurally disadvantaged by lack of deep customer integration.
- Bernstein and RBC also express constructive views, with Bernstein raising its price target and forecasting revenue likely above consensus for the upcoming quarter.
This coverage note summarizes analyst positions and market indicators cited by the brokers. It does not attempt to value specific scenarios beyond the published targets and multiples provided by those firms.