The Dutch semiconductor giant ASML Holding NV (NASDAQ: ASML) was among the first companies to offer a significant stock market reaction to the reports that multiple crucial U.S. allies – the Netherlands, Japan, and South Korea being the three named by press time on July 31 – could be exempt from President Biden’s restrictions on high-tech exports to China.
The stock, which has already offered a substantial 19.99% rise in 2024 but suffered a major 16.76% drop in the last 30 days, rocketed in Wednesday pre-market.
Indeed, while ASML closed on Tuesday at $860.24 after a significant daily decline, it rose as much as 7.59% in the extended session to its press time price of $925.51.
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Given the likely impact of the alleged exemption from the China export restrictions and the reaction ASML shares already had to the news, Finbold decided to examine if and how the analyst outlook has changed for the company.
Analysts set ASML 12-month price target
Though Wall Street experts are yet to react to the latest developments, their recent assessment of ASML shares has been overwhelmingly positive by July 31, 2024. Indeed, ASML boasts a ‘buy’ rating on the stock analysis platform TradingView, with 29 of the 39 represented experts rating it either a ‘strong buy’ or a ‘buy’ and only 1 estimating that selling is the best option.
The price target reevaluations of the semiconductor firm made in July have generally been positive.
On July 30, analysts at Barclays changed their stance on ASML from ‘neutral’ to ‘buy’ and raised their 12-month stock price forecast from $930 to $1150. The experts explained that thanks to the Dutch firm’s strong business model and the recent selloff, the company has become an enticing pick for investors.
Given that concerns over exports to China were among Barclays’ chief concerns for AMSL, the outlook is only to improve in the near future.
Finally, in mid-July, both JPMorgan (NYSE: JPM) and Susquehanna upgraded their 12-month price targets for ASML – the former from $1,172 to $1,202 and the latter from $1,200 to $1,300 – while reiterating their buy ratings.
Why Biden’s China export restrictions are controversial
President Biden’s restrictions on exports to China, announced late in 2023, have been controversial from day one.
Those who view the People’s Republic as a dangerous adversary of the U.S. may consider them paramount for national security as they are aimed at curbing the country’s technological development, others have pointed out they exacerbate the tensions and constitute a form of economic warfare while simultaneously harming various western companies.
Indeed, late last year, the decision sparked some concerns for Nvidia (NASDAQ: NVDA), given the significant quantity of microchips that were set to be shipped to the Chinese market and, amidst the ongoing technology sector downturn, the restrictions are still being cited as one of the possible reasons for the $1 trillion NVDA market capitalisation decline.
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