ASML Holding Rises 45% in Three Months: Should You Still Buy the Stock?

ASML Holding N.V. ASML shares have jumped 43% over the past three months, far outpacing the Zacks Computer and Technology sector’s 13.4% gain.ASML stock has also outperformed several semiconductor peers, including MKS Inc. MKSI, KLA Corporation KLAC and Applied Materials AMAT. In the past three months, shares of MKS, KLA Corporation and Applied Materials have risen 41.4%, 28% and 20.9%, respectively.ASML Holding 3-Month Price Return PerformanceImage Source: Zacks Investment ResearchAfter such a sharp run-up, investors are wondering if ASML Holding still has room to climb or if it’s time to wait for a pullback. Let’s find out.ASML’s EUV Technology: Its Core AdvantageASML Holding’s leadership in extreme ultraviolet (EUV) lithography continues to set it apart from every other chip equipment maker. It holds a near-monopoly on this technology, which is critical for manufacturing the world’s most advanced chips at 3nm and below. Major customers like TSMC, Samsung and Intel rely on ASML’s systems to stay ahead in chip innovation, giving ASML extraordinary pricing power and strategic importance.The next phase of growth lies in ASML Holding’s High Numerical Aperture (High-NA) EUV systems. These tools are designed for sub-2nm production, representing the next technological leap for chipmakers. While adoption has taken longer than initially expected, the long-term potential is significant. As the industry moves toward denser and more efficient chips, ASML’s High-NA machines will be central to that shift.ASML Holding is already making progress in this area. On its third-quarter 2025 earnings call, management confirmed that SK hynix received its first High-NA EXE:5200 system. This follows ASML’s first shipment and installation of the EXE:5200 system in the second quarter of 2025. These systems will support manufacturing at the 1.4nm node and beyond. ASML expects commercial adoption to begin in late 2026 or early 2027, creating a strong, multi-year growth driver.AI Boom Expands ASML’s Growth RunwayThe accelerating demand for artificial intelligence (AI) is giving ASML Holding another powerful growth tailwind. AI workloads need cutting-edge chips with massive processing power and efficiency. This indicates more demand for advanced graphics processing units, AI accelerators and high-bandwidth memory, all of which depend on the kind of precision lithography ASML’s EUV machines deliver.Because EUV technology is so complex and expensive to replicate, ASML Holding enjoys deep competitive protection. There’s no realistic rival in sight capable of challenging its dominance. This gives ASML not just pricing flexibility but a level of business stability rare in the semiconductor sector. As AI adoption continues across industries, ASML’s technology will remain indispensable in powering this new wave of computing.ASML’s Q3 Results Highlight Strong ProfitabilityASML Holding’s recently reported third-quarter 2025 results reinforced the company’s financial strength. Earnings grew 3.8% year over year to €5.48 per share. In U.S. dollar terms, earnings came at $6.41 per share, beating the Zacks Consensus Estimate by 2.2%. Revenues rose 0.7% to €7.52 billion, supported by a robust 27% increase in the services and field operations segment.ASML Holding N.V. Price, Consensus and EPS Surprise ASML Holding N.V. price-consensus-eps-surprise-chart | ASML Holding N.V. QuoteAlthough system sales slipped 6.3% due to a shift in product mix, the gross margin expanded to 51.6%, up 80 basis points. During the third-quarter earnings call, CFO Roger Dassen noted that higher volumes of low-NA EUV tools and upgrades helped margins.For the fourth quarter, ASML Holding expects revenues between €9.2 billion and €9.8 billion, a significant sequential increase. The company also anticipates gross margins of 51-53%, indicating a 40-basis-point sequential improvement at the mid-point. For full-year 2025, management projects sales to grow around 15% with margins near 52%, showing sustained demand for ASML’s products.ASML’s Strong Fundamentals Support Premium ValuationASML stock isn’t cheap. It trades at a forward 12-month price-to-earnings (P/E) of 34.25X compared with the sector average of 29.41X. However, that valuation looks more reasonable when viewed through the lens of ASML Holding’s market position. The company’s monopoly in EUV lithography, expanding role in advanced chip production and consistent margin performance justify a premium multiple.ASML Holding Forward 12-Month P/E RatioImage Source: Zacks Investment ResearchCompared to other semiconductor peers, ASML Holding has a higher P/E multiple than KLA Corporation, Applied Materials and MKS. Currently, KLA Corporation, Applied Materials and MKS trade at P/E of 31.66X, 24.00X and 17.69X, respectively. ASML’s higher multiple reflects not only its technology leadership but also the longer visibility of its growth cycle.Final Thoughts: ASML Stock Still Looks Like a BuyASML Holding’s unmatched dominance in EUV and emerging High-NA lithography, combined with surging AI-related chip demand, gives it a durable competitive edge. With strong revenue visibility, improving margins and expanding customer adoption, ASML’s fundamentals justify holding or even adding at current levels for long-term investors.Currently, ASML Holding sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Beyond Nvidia: AI's Second Wave Is HereThe AI revolution has already minted millionaires. But the stocks everyone knows about aren't likely to keep delivering the biggest profits. Little-known AI firms tackling the world's biggest problems may be more lucrative in the coming months and years.See "2nd Wave" AI stocks now >>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 Applied Materials, Inc. (AMAT): Free Stock Analysis Report MKS Inc. (MKSI): 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