According to reports from CNBC TV18, ASML semiconductor stock has delivered exceptional returns, more than doubling in value over the past year. The company's strong performance has caught the attention of market analysts, with Bernstein maintaining its positive outlook on the stock. As per Bernstein, the stock has gained 123% over the past year as artificial intelligence adoption has widened, increasing interest in the company's semiconductor manufacturing solutions. The stock advanced 3% in the premarket Monday following the latest target increase announcement.
As reported by CNBC TV18, Bernstein has reiterated its outperform rating on ASML stock and hiked its price target for the semiconductor equipment manufacturer. The investment firm has raised its price target on U.S.-listed shares to $2,623 from $1,971, implying 48% upside from Thursday's close. According to Bernstein analyst David Dai, the firm has materially increased ASML topline forecasts following the unprecedented AI-driven expansion in both advanced logic and dynamic random-access memory capacity. The call aligns with broader Street consensus, as all 19 analysts covering ASML have a buy or strong buy rating on the stock, according to LSEG data.
According to CNBC TV18, Bernstein's optimistic outlook is primarily driven by ASML's lithographic manufacturing technology gaining traction in the artificial intelligence industry. The firm believes this technological alignment positions the company for strong returns in the near future, as AI applications continue to drive demand for advanced semiconductor manufacturing capabilities. As per Bernstein, [high numerical aperture extreme ultraviolet] will likely be adopted first in DRAM than for logic due to lower cost of exposure for DRAM. ASML is the major supplier of high numerical aperture extreme ultraviolet lithography (HNA EUV), a manufacturing technology that is used to make memory solutions such as DRAM and high-bandwidth memory that power AI models. This positioning is further validated by recent developments in the semiconductor market, with SK Hynix launching a $28 billion US listing and drawing $7 billion in investor interest for chip factory construction and equipment purchases including ASML's extreme ultraviolet scanners.
The strong investor interest in SK Hynix's $28 billion US listing serves as additional validation of the semiconductor sector's growth potential. As reported by Reuters, the deal is expected to be the second-biggest share sale after a record $85.7 billion initial public offering by SpaceX last month, surpassing Saudi Aramco's $25.6 billion IPO in 2019 and Alibaba's similar-sized offering in 2014. SK Hynix is a key supplier of high-bandwidth memory chips used in AI systems by customers such as Nvidia and Alphabet's Google. Industry experts remain cautiously optimistic about memory cycle timing, with Standard Chartered's chief investment officer noting that while better access is expected, timing of the memory cycle is equally important, as the memory cycle is believed to be beyond the early phase and now in the mid-cycle stage. The listing is expected to help SK Hynix join the chip-heavy Philadelphia SE semiconductor index, potentially paving the way for increased passive investments in the sector.
