Bank of America is confident in semiconductor equipment maker ASML Holding as a long-term play despite the company’s mixed earnings report. Analyst Didier Scemama named the stock a top pick and reiterated a buy rating. His price target on U.S.-listed shares of $810 implies upside of 33.1% over the next 12 months. The Dutch technology firm reported slightly weaker-than-expected net sales for third quarter and a net profit that was about in line with an LSEG consensus forecast. Those figures — €6.67 billion for net sales and €1.89 billion in net sales — represent quarter-over-quarter declines. Still, ASML reaffirmed its guidance for net sales to increase 30% year on year for 2023. The analyst noted that ASML’s sales to China increased during the quarterly period, and said the company is confident that its 2nm process node with TSMC will start ramping in 2025 and 2026. Shares declined 2.9% in premarket trading. The stock has added 11.4% this year. According to Bank of America, upside for the stock can be driven by factors including: Stronger-than-forecast demand for EUV, or extreme ultraviolet, and DUV, or deep ultraviolet, machines “Higher-than-expected gross margins on EUV machines and services” Strong capital expenditures in the space driven by macroeconomic trends and higher capital intensity Downside risks include delays in ramping volume shipments of EUV machines and lower-than-expected gross margins from those platforms. ASML YTD mountain ASML stock. — CNBC’s Michael Bloom contributed to this report.
