The Ultimate Guide to ASML Holding NV (AS::NA) Price Target Adjustment by Deutsche Bank - Impact on Semiconductor Market Revealed!
Deutsche Bank has just adjusted its price target for ASML Holding NV (AS::NA) (NASDAQ: ASML) to €950, down from the previous €1,100. Despite this reduction, the firm has maintained its Buy rating on the stock. This change reflects a 14% decrease in the target price and is based on a revised earnings per share (EPS) forecast for the company.
The reduction in price target and EPS forecast is due to recent developments affecting ASML, particularly in China and with one of its major customers, Intel (NASDAQ:). There is a observed deterioration in the spending outlook for mainstream semiconductor nodes in China, leading to over-capacity and challenges for newer entities backed by Chinese provinces. This is causing issues with yields and funding.
ASML's situation is further complicated by potential U.S. restrictions on Chinese technology companies. Concerns have been raised that Chinese DRAM manufacturers could be added to the U.S. entity list due to alleged connections with Huawei. This could adversely affect ASML's sales in China.
Deutsche Bank now anticipates a 22% decline in ASML's China sales by 2025. This forecast is against a backdrop of weakening demand not only in analog and power sectors but also in mainstream foundries.
The bank has revised EPS estimates for ASML, projecting a more cautious outlook for the company's financial performance in the coming years. In other news, ASML is facing increased export controls on its chipmaking equipment by the Netherlands, which aligns with U.S. export restrictions and has drawn criticism from China.
This could impact ASML's business with China, potentially affecting the company's earnings and revenue. BofA Securities has revised its price target on ASML shares, while Morgan Stanley and UBS have made adjustments to their ratings. Barclays, on the other hand, has upgraded ASML's stock.
Analysis: The price target adjustment and EPS forecast revision for ASML by Deutsche Bank indicate potential challenges ahead for the company in the semiconductor market. Investors should pay close attention to developments in China and export controls, as these factors could significantly impact ASML's financial performance in the coming years. It is advisable to proceed with caution and stay informed about the latest news and updates regarding ASML and the semiconductor industry.