Returning ASML To The Watch List

After a recent tweak to the Green Screen algorithm, we've gotten a bunch of slightly lower growth but very high-quality companies back, and one of them is ASML (ASML).

As covered in our initial overview, ASML is a one-of-a-kind company that not only dominates (~90% market share) traditional semiconductor lithography equipment, it is also a true monopoly in equipment to produce the most modern 3nm and under chips. Nothing has really changed in that regard over the past 2 years. In fact, the company installed its first "High-NA" systems last year.

Despite a semiconductor slump over the past year or so, the future still looks very good to me. Global semiconductor sales are expected to grow at a 9% annual rate through 2030, driven by almost limitless AI applications. Semiconductor fabs are being built all over the world, as global powers attempt to protect their supply chains. Despite all this, ASML is trading at a very attractive price that is almost the same as we saw in 2023.

The only major difference is new leadership. Christophe Fouquet, a 17 year company veteran, took over as CEO about a year ago. I don't see any major risk here. Fouquet is a 25 year industry veteran, and ASML has tremendous economic moat advantages.

ASML returns to the Watch List today and we will keep a close eye out for a buying point in the near future.