Key insights
- ASML's earnings are expected Wednesday, with options markets pricing in a potential 6% swing. Strong AI chip demand has fueled a 40% YTD gain. As the leading semiconductor equipment supplier, ASML's results and outlook are a bellwether for chipmaker confidence and future capital expenditures. Analysts anticipate a reiteration of strong guidance, suggesting continued bullish sentiment for the semiconductor sector. This could positively influence US-listed semiconductor stocks.
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ASML (ASML) is set to post earnings Wednesday morning, with traders anticipating the stock could reach a record high following the results.
Based on current options pricing, traders expect the U.S.-listed shares of the Dutch company could swing up to 6% in either direction by the end of the week. A move of that size from Monday's close could lift shares to around $1,590, surpassing the record set in late February. The low end of that range would drag shares down to $1,410.
ASML shares have gained 40% since the start of the year, as booming demand for AI chips and the equipment to make them drove sales to new highs.
As the world's largest supplier of semiconductor manufacturing equipment, ASML's results may be taken as an indicator of how confident chipmakers are about future demand.
Jefferies analysts recently wrote that they expect ASML and other equipment makers to "reiterate the strong outlook statements" that the companies laid out in their last quarterly reports, as high demand for chips is pushing chipmakers to boost production capacity.
ASML is projected to report earnings of 6.69 euros ($7.84) per share on a 12% year-over-year jump in revenue to 8.69 billion euros ($10.19 billion) for the first quarter.
Wall Street analysts are largely bullish on ASML. Eight of the nine analysts with current ratings tracked by Visble Alpha have recommended buying the stock, compared to just one "sell" rating.
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