Morningstar Expects ASML Holding (ASML) to Remain Top Lithography Equipment Provider

ASML Holding N.V. (NASDAQ:ASML) is one of the 10 Best Semiconductor Stocks to Buy According to Reddit. Morningstar believes that the company will remain the top lithography equipment provider in semiconductor foundries for a minimum of the next 2 decades. The other companies have redesigned their fabs a decade ago in order to make them suitable for extreme ultraviolet, or EUV, lithography, which happens to be a costly and long endeavor. Therefore, Morningstar opines that ASML Holding N.V. (NASDAQ:ASML) is not likely to be displaced from its place.

Furthermore, no competitor has been able to match ASML Holding N.V. (NASDAQ:ASML)’s technological leadership. Its competitive advantage is expected to continue to expand further, added the firm. ASML Holding N.V. (NASDAQ:ASML)’s leading market position further strengthens its key role in the broader global semiconductor supply chain. Its EUV technology, critical for producing advanced logic and memory chips, has supported it in being regarded as an indispensable partner for the semiconductor manufacturers.

In Q1 2025, ASML Holding N.V. (NASDAQ:ASML) saw total net sales of €7.7 billion, gross margin of 54.0%, and net income of €2.4 billion, with quarterly net bookings coming at €3.9 billion, of which €1.2 billion is EUV. Parnassus Investments, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:

“In Information Technology, we moved from an underweight to an overweight as we added new positions in Synopsys, ASML Holding N.V. (NASDAQ:ASML) and AppFolio while selling Adobe and Procore Technologies. ASML is a leading supplier of photolithography systems, equipment crucial for producing advanced microchips. It has a wide moat built on technology innovation, high market share and strong customer and supplier relationships.”

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Disclosure: None. This article is originally published at Insider Monkey.