ASML’s latest results initially sparked a rally, but concerns about meeting record orders caused a 2% stock drop. The Dutch chip-machine maker’s shares surged 34% this month, trading at 42 times 2026 earnings estimates, exceeding Nvidia’s 25 times. Analysts forecast sales growth of 4% to 19% this year, questioning the high valuation.

With ASML near record highs, investors question its growth potential. The company’s order backlog is 38.8 billion euros, with AI-driven expansions from top customers like TSMC and memory chip makers Samsung, SK Hynix, and Micron. ASML is the sole producer of EUV lithography systems crucial for advanced chip production.

Analysts debate ASML’s premium valuation as sector upgrades may slow. Investors view ASML and peers as a way to capitalize on increasing chip demand without direct chipmaker exposure. CEO Christophe Fouquet assures that ASML won’t become a bottleneck, with JPMorgan analyst Sandeep Deshpande seeing reasonable valuation heading to 2027.

Despite concerns about delays impacting chip facilities, analysts recommend ASML for long-term growth prospects. The expensive stock has proven lucrative for many investors who regret not buying sooner. ASML remains a strong investment despite its high valuation, with a steady growth outlook for the future.

Read more at Yahoo Finance: Analysis-Is chip giant ASML about to hit a ceiling, or break through it?