Back to top

Image: Bigstock

ASML (ASML) Stock Sinks As Market Gains: What You Should Know

Read MoreHide Full Article

ASML (ASML - Free Report) closed the most recent trading day at $716.63, moving -0.77% from the previous trading session. This change lagged the S&P 500's 0.24% gain on the day. Meanwhile, the Dow gained 0.03%, and the Nasdaq, a tech-heavy index, added 5.73%.

Heading into today, shares of the equipment supplier to semiconductor makers had gained 10.26% over the past month, lagging the Computer and Technology sector's gain of 10.73% and outpacing the S&P 500's gain of 3.56% in that time.

ASML will be looking to display strength as it nears its next earnings release. On that day, ASML is projected to report earnings of $4.98 per share, which would represent year-over-year growth of 32.1%.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $20.45 per share and revenue of $29.15 billion. These totals would mark changes of +37.34% and +26.36%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for ASML. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. The Zacks Consensus EPS estimate has moved 0.46% lower within the past month. ASML is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, ASML is currently trading at a Forward P/E ratio of 35.32. This valuation marks a premium compared to its industry's average Forward P/E of 19.27.

It is also worth noting that ASML currently has a PEG ratio of 1.21. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ASML's industry had an average PEG ratio of 3.39 as of yesterday's close.

The Semiconductor Equipment - Wafer Fabrication industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 111, which puts it in the top 45% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. 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

See More Zacks Research for These Tickers

Normally $25 each - click below to receive one report FREE:

ASML Holding N.V. (ASML) - free report >>

Published in