Sunday, April 19, 2020

The Strategic Value Of EUV Limits ASML's Downside

Lithography specialist ASML (ASML) reduced guidance on March 30 and did indeed see an impact to results in the first quarter, but I would argue that the results (including orders) reflect the underlying strategic value and necessity of the company’s lithography systems (especially the emerging EUV opportunity) – a reality that significantly mitigates the company’s downside risk in this period of significant economic upheaval.

The full-out panic back in March did take these shares back below $200, and I hope readers who had watch-list’ed this name stepped up and took advantage, as the shares have shot back up almost 60% and once again trade at a healthy premium. While another Covid-19/recession-related pullback is at least possible, investors are once again left dealing with a stock that offers “okay” potential from here.

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The Strategic Value Of EUV Limits ASML's Downside

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