ASML makes the lithography machines without which the most advanced chips cannot be produced. It holds a near monopoly in extreme ultraviolet.
Analysis
After the September correction, the stock rebounds on renewed enthusiasm for the AI investment cycle. AI is no longer only about Nvidia: demand is spreading to chipmakers, and therefore to their equipment suppliers.
Opportunity
The opportunity is the visibility provided by the foundries’ multi year order books. The risk is geopolitical, through export restrictions to China.
Investor outlook
Positive outlook. The theme of AI broadening benefits directly the link that is hardest to replace.
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