This stock dominates one critical corner of the AI supply chain. Goldman Sachs sees further gains to come

Goldman Sachs says ASML’s monopoly over EUV lithography — the indispensable step for producing smaller, more powerful AI chips — positions the Dutch equipment maker for substantial upside from AI-driven demand; in a most bullish scenario requiring 104 EUV tools by 2030 Goldman models roughly a 59% revenue uplift to the midpoint of ASML’s 2030 guidance. The bank sets a €1,050 12‑month target, views ASML’s valuation as only modestly premium to European tech peers, and highlights potential spillover gains for other equipment names (Infineon, ASMI, BESI) while warning of key risks including EUV delays, capex cyclicality and market‑share shifts. ASML, the largest listed European firm with a ~$395bn market cap, has rallied ~44% YTD after a volatile year and management’s reassurances on 2025–26 sales prospects.

Analysis

Goldman Sachs argues ASML's exclusive scale in EUV lithography positions it as a critical enabler of AI-driven semiconductor production, projecting a most-bullish scenario where demand for 104 EUV machines by 2030 would lift revenue by roughly 59% to the midpoint of ASML's 2030 guidance. The firm notes ASML is the only company able to produce EUV equipment at scale, is targeting ~90 EUV units by 2025, and underpins finer circuitry needed for next-generation logic, memory and analog chips.

Goldman sets a €1,050 12‑month target and describes ASML's valuation as only modestly premium (50% vs a five‑year European tech median of 43%), while ASML shares have rallied 43.8% YTD after a choppy year; management reiterated that 2026 net sales should exceed this year and maintained a positive 2025 sales outlook.

Goldman flags execution risks—EUV delays, capex cyclicality and unfavorable market‑share shifts—that could compress the timing or magnitude of upside; the bank also models secondary upside for peers with maximum revenue uplifts of 42% for Infineon, 44% for ASMI and 65% for BESI but emphasizes BESI's smaller base limits scale.

Key Decisions for Investors

• Consider increasing exposure to ASML to capture AI-driven EUV demand given Goldman Sachs' 59% upside scenario and €1,050 target, but size positions conservatively after the 43.8% YTD rally
• Monitor EUV delivery cadence, quarterly order intake and capex guidance closely and use confirmed order-flow or delivery progress as triggers to add to holdings, hedge or trim exposure
• Evaluate selective, smaller allocations to ASMI and BESI to participate in equipment-sector upside while acknowledging higher execution and scale risk for these names
• Watch valuation dispersion versus European tech peers and prefer entering or adding on meaningful pullbacks or when incoming orders mitigate the key risk of EUV delays