Is ASML's (ASML) Leadership Threatened After Substrate's Recent Better Technology Claims?

ASML Holding N.V. (NASDAQ:ASML) is among the most fantastic stocks every investor should pay attention to. On October 29, Bernstein SocGen Group analyst David Dai reiterated his Market Perform rating on ASML with a price target of $935.00. The update was intended to address concerns raised after a startup called “Substrate” claimed to have built a semiconductor manufacturing machine that is as good as the EUV machines from ASML.

In a challenge to ASML and the foundry company TSMC, the Substrate team demonstrated its method using X-ray technology, and its founder, James Proud, aims to potentially replace machines from ASML in the manufacture of advanced chips.

However, David Dai argues that the mentioned technology had been proposed earlier but couldn’t make further inroads, and was later abandoned after the EUV technology took root.

As per a Bloomberg report from November 3, Dai believed that Substrate is aiming too high currently, and further stated:

“In theory, X-ray lithography should offer better resolution than EUV, but too many problems proved insurmountable. If the startup truly believes in its technology, the only viable approach is to form an ecosystem around it and get the industry to work together.”

ASML Holding N.V. (NASDAQ:ASML) is a leading supplier of photolithography equipment used in advanced semiconductor manufacturing. Its extreme ultraviolet (EUV) and deep ultraviolet (DUV) systems enable chipmakers to produce smaller and more powerful integrated circuits.

While we acknowledge the potential of ASML as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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