ASML: An Indirect But Very Real Beneficiary Of The AI Memory Supercycle (Archive)

This 5-Minute Pitch was originally published on Seeking Alpha before the launch of the Hunting Alphas website. It is shared here to showcase my previous work and track record. New 5-Minute Pitches published on this site will not be disseminated anywhere else.

Elevator Pitch

• ASML’s DRAM memory supercycle should drive a strong rebound in bookings and book-to-bill, as leading DRAM makers add substantial greenfield capacity that requires more complex lithography.
• High-NA EUV is progressing from R&D into commercial ramp, with Intel and other customers preparing for 14A and advanced nodes, supporting a recovery in system sales from late FY26 onwards.
• Increasing High-NA EUV volumes should help ASML progress toward its FY30 gross margin target, as scale reduces High-NA dilutive effects and lifts the overall margin mix.
• ASML’s valuation premium versus major semiconductor equipment peers is near historical trough levels, while technicals show a decisive bullish breakout versus the S&P 500.
• China contributed a high share of ASML revenue recently, but management expects significantly lower China demand in 2026 even as total FY26 sales remain at or above FY25.

Read the full article here.