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ASML (ASML) Dips More Than Broader Markets: What You Should Know

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ASML (ASML - Free Report) closed at $576.29 in the latest trading session, marking a -1.22% move from the prior day. This move lagged the S&P 500's daily loss of 0.63%. Elsewhere, the Dow lost 0.67%, while the tech-heavy Nasdaq lost 0.15%.

Heading into today, shares of the equipment supplier to semiconductor makers had gained 2.15% over the past month, outpacing the Computer and Technology sector's loss of 1.03% and the S&P 500's gain of 0.89% in that time.

Wall Street will be looking for positivity from ASML as it approaches its next earnings report date. On that day, ASML is projected to report earnings of $3.53 per share, which would represent year-over-year growth of 16.12%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.29 billion, up 9.22% from the year-ago period.

ASML's full-year Zacks Consensus Estimates are calling for earnings of $17.54 per share and revenue of $23.68 billion. These results would represent year-over-year changes of +6.95% and +7.73%, respectively.

It is also important to note the recent changes to analyst estimates for ASML. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.72% lower. ASML is currently a Zacks Rank #4 (Sell).

Valuation is also important, so investors should note that ASML has a Forward P/E ratio of 33.26 right now. Its industry sports an average Forward P/E of 16.33, so we one might conclude that ASML is trading at a premium comparatively.

We can also see that ASML currently has a PEG ratio of 1.88. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. ASML's industry had an average PEG ratio of 1.78 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 246, putting it in the bottom 3% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow ASML in the coming trading sessions, be sure to utilize Zacks.com.


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