Market Snapshot
Date: 13 Mar 2026
Sector: Semiconductor Equipment.
Key Driver: AI-led advanced logic and DRAM capacity buildout, supported by ASML’s EUV/High-NA roadmap, €38.8 billion backlog, and 2026 sales guidance of €34-39 billion.
METRICS
Core Metrics
Metric | Current | Read |
|---|---|---|
Revenue Growth | 15.6% | Re-accelerating |
EPS Growth | 28.5% | Strong operating leverage |
Gross Margin | 52.8% | Elite tool economics |
Operating Margin | 34.6% | Expanded in FY25 |
Free Cash Flow Margin | 33.8% | High cash conversion |
Backlog / Sales | 1.19x | Strong visibility |
FY2025 metrics are from ASML’s 2025 results; free cash flow margin and backlog/sales are derived from reported FY2025 values and year-end backlog.
VALUATION
Valuation Check
Item | Current | Reference | Interpretation |
|---|---|---|---|
Trailing P/E | 47.7x | 5Y avg 36.5x | Rich vs history |
EV/Sales | 13.7x | 5Y avg 11.4x | Premium/full |
FCF Yield | 2.4% | 5Y avg 2.6% | Not cheap |
2026 Revenue Growth (midpoint) | 11.7% | FY25 growth 15.6% | Premium needs durability |
Current valuation ratios are as of March 12, 2026; 2026 growth uses the midpoint of ASML’s €34-39 billion guide versus FY2025 sales.
What the Market is Pricing In
ASML’s current valuation implies investors expect AI-driven EUV demand, High-NA adoption, and installed-base/service growth to remain durable well beyond 2026, not just through the next order cycle. It also implies gross margin can hold around the low-50s near term and eventually move toward management’s longer-term 56-60% framework, with industry structure and export controls not materially breaking the thesis.
TRIGGER
Trigger Map
Type | Signal |
|---|---|
Bull Trigger | Backlog converts cleanly, EUV/High-NA ramps faster than expected, and margins start tracking toward the long-term framework. |
Base Case | Revenue lands around the 2026 guide midpoint, gross margin stays near 52%, and the multiple remains premium but stable. |
Failure Condition | AI/logic capex pauses, backlog slips on customer timing or export issues, and valuation compresses back toward historical averages. |
Verdict
Best-in-class asset, but today’s price already discounts sustained EUV/High-NA growth and margin durability, leaving limited room for execution misses.
Rating: Rich
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