Jefferies downgrades ASML stock to hold on 2026 revenue concerns
Investing.com
Published Jun 26, 2025 03:18AM ET
Investing.com - Jefferies downgraded ASML Holding (AS:ASML) NV (NASDAQ:ASML) from buy to hold on Thursday, while raising its price target to EUR690.00 from EUR660.00. The semiconductor equipment giant, currently valued at $317.34B, has demonstrated robust financial performance with a 17.67% revenue growth over the last twelve months. According to InvestingPro data, ASML maintains a "GREAT" financial health score of 3.02.
The research firm cited concerns about ASML's 2026 outlook, forecasting a 2% year-over-year revenue decline to EUR32.1 billion and a 6% drop in earnings per share. These projections fall significantly below consensus estimates, with Jefferies' sales forecast 9% lower and EPS forecast 17% below market expectations. The stock currently trades at a P/E ratio of 31.43x, which InvestingPro analysis suggests is high relative to its near-term earnings growth potential. Discover 10+ additional exclusive insights about ASML with an InvestingPro subscription.
Jefferies expects semiconductor capital equipment industry news to deteriorate in the second half of this year, creating pressure on ASML's financial estimates. Despite these concerns, the firm believes downside risk to ASML's share price is limited due to the stock's recent derating.
The research firm noted that while it maintains near-term caution, ASML remains attractive for investors with investment horizons longer than one year. Jefferies expects lithography intensity to remain flat to up over the next five years.
ASML's long-term outlook includes Taiwan Semiconductor Manufacturing Company adopting high-NA EUV systems at its A14 node in 2028, according to Jefferies' analysis.
In other recent news, ASML Holding NV reported a mixed set of developments impacting its financial outlook. The company announced a significant decline in first-quarter bookings for 2025, totaling approximately €3.9 billion, which is a drop from the previous quarter's €7.1 billion. Despite this, ASML reaffirmed its revenue guidance for 2025, targeting €30-€35 billion. Analysts from Raymond James maintained a Strong Buy rating, highlighting ASML's gross margin strength but revised the price target to $850 due to higher-than-anticipated operating expenses. Deutsche Bank also adjusted its price target to EUR700, citing challenges such as setbacks in foundry operations and geopolitical tensions. Barclays downgraded ASML's stock to Equalweight, reducing the price target to €650, amid concerns of muted growth prospects. Wells Fargo, while lowering its price target to $840, maintained an Overweight rating, noting potential upside from AI-related demand. Bernstein initiated coverage with a Market Perform rating, expressing concerns over ASML's EUV lithography business and projecting lower future growth compared to company guidance. These recent developments reflect the varied analyst perspectives on ASML's financial trajectory and market positioning.
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Written By: Investing.com
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