ASML Stock Rises 58.2% in 6 Months: Should You Buy, Sell or Hold?

ASML Holding ASML shares have surged 58.2% in the past six months, outperforming the Zacks Computer and Technology sector’s growth of 19%. Given this outperformance in the share price, the question remains: Should the investors buy, sell or hold the shares of this semiconductor manufacturing equipment player?ASML 6-Month Performance ChartImage Source: Zacks Investment ResearchASML’s 50-Day & 200-Day SMAs Show Bullish TrendThis surge in the stock price has led ASML’s shares to trade above the 50-day and 200-day simple moving averages (SMAs), indicating a bullish trend.Image Source: Zacks Investment ResearchASML Capitalizes on Growing AI Semiconductor DemandAI-driven semiconductor demand is on the rise as global enterprises move toward an AI future. For ASML, the AI-trend has become the primary growth driver as customers demand semiconductor manufacturing equipment for logic and memory chips for AI workloads, high bandwidth memory and DDR5, keeping system demand structurally strong.Since ASML holds a near-monopoly in extreme ultraviolet (EUV) technology crucial for the world’s most advanced chips at 3nm and below, it benefits from extraordinary pricing power and strategic importance. Major customers like TSMC, Samsung and Intel rely on ASML’s systems to stay ahead in chip innovation.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.These factors will drive ASML’s top line. For the fourth quarter of 2025, ASML Holding expects revenues to be between €9.2 billion and €9.8 billion, a 26.3% sequential increase at the midpoint. For full-year 2025, management projects sales to improve around 15%, with margins of nearly 52%, showing sustained demand for ASML’s products.ASML Faces Macroeconomic and Competitive ChallengesASML faces direct challenges from the ongoing trade tensions, policy unpredictability, and geopolitical developments affecting its customers’ visibility and confidence, particularly around long-term capital expenditure decisions. ASML’s management accepted that they cannot ascertain its growth for 2026 in the given situation.The company also faces competitive challenges from players like Applied Materials AMAT, Lam Research LRCX and KLA Corporation KLAC. Although ASML is the only company providing EUV lithography tools, it operates in a broader ecosystem of semiconductor equipment makers that are also transitioning to 2nm with their respective technology.Applied Materials supplies equipment used in chip fabrication, including deposition and etching tools that are essential for both advanced and mature nodes. As chips become more complex with AI and high-performance workloads, Applied Materials’ tools aid in designing and making efficient and smaller node chips.KLA Corporation specializes in process control, inspection and metrology systems. KLA Corporation’s equipment helps chipmakers monitor and improve yield during manufacturing. Lam Research competes in the memory space. Lam Research’s memory segment, accounting for both Dynamic Random Access Memory and Non-Volatile Memory divisions, is gaining traction on the back of AI.Furthermore, ASML expects its China business to normalize after two years of extraordinary growth. This will cause a decline in revenues from this direction. Closely linked to China’s normalization, ASML expects its deep UV business to decline in 2026, since China has been a major end market for immersion and mainstream lithography tools.ASML Shares are OvervaluedASML stock trades at a forward 12-month price-to-earnings (P/E) of 40.78X compared with the sector average of 23.19X, which makes it overvalued at present, as suggested by the Zacks Value Score of F.ASML Forward 12-Month (P/E) Valuation ChartImage Source: Zacks Investment ResearchConclusion: Hold ASML For NowASML Holding’s strong presence in EUV and emerging High-NA lithography, combined with surging AI-related chip demand, makes it a stock worth keeping under watch. However, strong competition in the broader category, macroeconomic and geopolitical challenges raise near-term concerns. Considering these factors, we suggest investors to retain this Zacks Rank #3 (Hold) stock at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.#1 Semiconductor Stock to Buy (Not NVDA)The incredible demand for data is fueling the market's next digital gold rush. As data centers continue to be built and constantly upgraded, the companies that provide the hardware for these behemoths will become the NVIDIAs of tomorrow.One under-the-radar chipmaker is uniquely positioned to take advantage of the next growth stage of this market. It specializes in semiconductor products that titans like NVIDIA don't build. It's just beginning to enter the spotlight, which is exactly where you want to be.See This Stock Now for 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