ASML Climbs 11% in a Month: Time to Buy, Sell or Hold the Stock?

ASML Holding ASML shares have surged 11.3% in the past month, outperforming the Zacks Computer and Technology sector’s decline of 3.4%. ASML stock has also outperformed its peers, namely Lam Research LRCX and KLA Corporation KLAC, while underperforming Applied Materials AMAT in the same time frame.ASML One-Month Performance ChartImage Source: Zacks Investment ResearchShares of Lam Research, KLA Corporation and Applied Materials have returned 10.8%, 1.1% and 19.1%, respectively. This surge in stock price has also made ASML stock overvalued. ASML stock trades at a forward 12-month price-to-sales (P/S) of 12.66X compared with the sector average of 6.37X, which makes it overvalued at present, as suggested by the Zacks Value Score of F.ASML Forward 12-Month Valuation ChartImage Source: Zacks Investment ResearchNow the question remains: Should the investors buy, sell or hold shares of this semiconductor manufacturing equipment player?ASML Gains From AI-Led Demand Surge for HBM and DRAM NodesSustained demand for artificial intelligence and high performance computing chips by global data centers, AI labs and hyperscalers has reinforced ASML’s long-term growth outlook as the company provides extreme ultraviolet (EUV) semiconductor lithography tools to chip manufacturers that enable them to accelerate capacity expansion.ASML’s management on the fourth-quarter 2025 earnings call noted that ASML’s customers have become more confident about medium-term AI demand, leading to stronger order intake and investment plans as chipmakers transition from 4-nanometer to 3-nanometer and prepare for the 2-nanometer transition.As EUV intensity per wafer continues to rise, AI and HPC workloads are addressed more efficiently. In memory, robust demand for high-bandwidth memory (HBM) and advanced DRAM nodes is expected to tighten supply through at least 2026, further supporting EUV demand.ASML is also benefiting from a growing installed base, which is driving high-margin service and upgrade revenues as customers increasingly view upgrades as the fastest way to add capacity. With a €38.8 billion backlog and reaffirmed long-term targets, ASML remains well-positioned to capitalize on the AI-led semiconductor investment cycle.For 2026, ASML expects its revenues in the range of €34-€39 billion. The Zacks Consensus Estimate for ASML’s 2026 revenues is pegged at $43.31 billion, indicating a year-over-year improvement of 17%.ASML Dominates the EUV Landscape UnchallengedAlthough ASML faces competitive pressure from players like Lam Research, Applied Materials and KLA Corporation in the broader wafer equipment manufacturing market, ASML holds a near-monopoly in EUV technology.EUV is crucial for the world’s most advanced chips at 3nm and below; it benefits from extraordinary pricing power and strategic importance with major customers like TSMC, Samsung and Intel.ASML’s venture into sub-2nm production with High Numerical Aperture (High-NA) EUV systems is the next technological leap for chipmakers. This technology will provide ASML with long-term potential as the industry moves toward denser and more efficient chips. ASML’s High-NA machines will be central to that shift.The Zacks Consensus Estimate for ASML’s 2026 earnings is pegged at $33.63, indicating a year-over-year improvement of 20.3%. The consensus estimate has been revised upward in the past seven days.Image Source: Zacks Investment ResearchConclusion: Buy ASML Stock NowASML’s unmatched EUV leadership, AI-driven demand visibility, and strong earnings momentum support a long-term bullish view, making this Zacks Rank #2 (Buy) stock attractive at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Free Report: Profiting from the 2nd Wave of AI ExplosionThe next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives.Investors who bought shares like Nvidia at the right time have had a shot at huge gains.But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies.Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report KLA Corporation (KLAC): Free Stock Analysis Report ASML Holding N.V. (ASML): Free Stock Analysis Report Lam Research Corporation (LRCX): Free Stock Analysis Report Applied Materials, Inc. (AMAT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks