ASML Bulls Beware: The Data Points To Prolonged Weakness Ahead (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 Holding N.V.'s latest results suggest the risk of flat growth in 2026 despite strong AI sector headlines. I think the bullish views may be missing important warning signs.
• Demand for new machines is falling while used equipment sales rise, hinting at deeper industry trouble just as inventories pile up in semiconductor companies.
• I expect the unfavorable used vs. new unit mix trends to persist, and this can put further pressure on management's already downgraded gross margin outlook.
• ASML stock is trading at a premium to its longer term median levels, and I doubt this is justified given the risks of zero-growth in FY26.
• Favorable U.S. - EU tariff policy developments are a source of upside risk. But I suspect that ASML's customers may wait for a longer period of trade stability before committing hundreds of millions of dollars into ASML's machines.

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