ASML Holding has broken into the top decile of market momentum scores according to Benzinga Edge, reflecting a six-month relative strength of 82.3% versus semiconductor peers. The company’s shares have climbed over 28% since January, driven by robust order intake for its extreme ultraviolet (EUV) lithography systems. Analyst firm Bernstein highlighted that ASML is poised for “big years” ahead, forecasting a compound annual growth rate of 12% in capital equipment revenues through fiscal 2028 as the AI chip build-out accelerates globally.

With leading DRAM manufacturers committing to over $200 billion in greenfield memory fab expansions over the next five years, ASML’s bookings for immersion and EUV systems have rebounded sharply. The company reported a book-to-bill ratio of 1.3 in the latest quarter, its highest level since 2021. High-NA EUV technology is transitioning from R&D to commercial ramp, with initial shipments scheduled for late fiscal 2026 and volume ramps targeting 20 units in fiscal 2027, supporting system sales recovery and helping meet customer roadmaps for 14A and more advanced nodes.

Analysts maintain a HOLD rating on ASML for the near term, while recommending a BUY for long-term investors based on a discounted cash flow valuation of approximately $1,200 per share. Near-term risks stem from an anticipated 15% decline in revenue from China in calendar 2026 as local foundries defer investment, but forecasts show stabilization by late 2026 and a modest recovery into 2027. Management reiterates that these fluctuations will not derail the multiyear growth trajectory driven by AI and high-bandwidth memory demand.

ASML aims to leverage scale in high-NA EUV systems to improve its overall gross margin from 53% in fiscal 2024 to a target of 56% by fiscal 2030. As volumes increase, the dilutive impact of early-stage high-NA development will diminish. The company expects high-NA shipments to contribute 15% of total system revenue by fiscal 2028, supporting progressive margin expansion. This strategic mix shift, combined with cost efficiencies in immersion lithography, underpins ASML’s path to record profit levels and strong free cash flow generation into the next decade.