Despite warnings of an AI bubble, ASML's growth aligns with trends seen in Microsoft, Nvidia, and Arm. However, not all are investing in ASML, with Samsung recently withdrawing its entire 0.4% stake in the company. ASML also faces competition from Canon, which plans to undercut ASML with $150 million chipmaking machines. Despite these challenges, some analysts suggest ASML could continue to ride this bullish wave for some time.
Key takeaways:
- ASML's AI-driven growth has led to a significant increase in its stock value, making it the second most "overowned" European equity, according to Morgan Stanley research.
- Despite warnings of an AI bubble, the AI sector continues to grow, with Nvidia's stock tripling in value last year and Arm's shares jumping nearly 50% after its third-quarter earnings release.
- ASML's "overowned" status is also attributed to a herd mentality among investors who are keen to invest in a stock market that continues to yield high returns.
- ASML recently lost Samsung as a stakeholder, and it faces competition from Canon, which plans to undercut ASML with $150 million chipmaking machines.