Comparative Study: ASML Holding And Industry Competitors In Semiconductors & Semiconductor Equipment Industry

In the ever-changing and fiercely competitive business landscape, conducting thorough company analysis is crucial for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating ASML Holding ASML and its primary competitors in the Semiconductors & Semiconductor Equipment industry. By closely examining key financial metrics, market position, and growth prospects, our aim is to provide valuable insights for investors and shed light on company's performance within the industry.

ASML Holding Background

ASML is the leader in photolithography systems used in the manufacturing of semiconductors. Photolithography is the process in which a light source is used to expose circuit patterns from a photo mask onto a semiconductor wafer. The latest technological advances in this segment allow chipmakers to continually increase the number of transistors on the same area of silicon, with lithography historically representing a high portion of the cost of making cutting-edge chips. ASML outsources the manufacturing of most of its parts, acting like an assembler. ASML's main clients are TSMC, Samsung, and Intel.

Company P/E P/B P/S ROE EBITDA (in billions) Gross Profit (in billions) Revenue Growth
ASML Holding NV 33.86 21.51 9.62 16.76% $2.36 $3.46 15.48%
Applied Materials Inc 18.62 7.68 4.81 12.75% $2.36 $3.17 -0.39%
Lam Research Corp 25.52 12.32 6.41 10.92% $1.16 $1.65 -31.38%
KLA Corp 24.89 25.30 7.60 25.09% $1.03 $1.45 -12.02%
Entegris Inc 84.66 5.02 4.64 0.99% $0.2 $0.37 -10.62%
Teradyne Inc 48.95 6.59 11.24 5.25% $0.17 $0.4 -64.91%
Enphase Energy Inc 29.34 15.75 6.26 11.47% $0.16 $0.26 -13.18%
Amkor Technology Inc 18.74 1.96 1.14 3.5% $0.33 $0.28 -12.57%
Onto Innovation Inc 45.47 4.18 8.38 2.14% $0.05 $0.11 -18.51%
SolarEdge Technologies Inc 20.88 1.76 1.29 -2.44% $-0.0 $0.14 -13.32%
Axcelis Technologies Inc 17.19 4.91 3.67 8.53% $0.08 $0.13 27.56%
Kulicke & Soffa Industries Inc 51.57 2.47 3.96 1.99% $0.04 $0.1 -29.34%
Photronics Inc 14.67 1.91 2.06 4.61% $0.1 $0.08 8.18%
Veeco Instruments Inc 27.59 2.48 2.49 3.99% $0.03 $0.08 3.17%
Cohu Inc 30.98 1.68 2.33 0.41% $0.02 $0.07 -27.04%
ACM Research Inc 17.98 1.61 2.54 3.61% $0.03 $0.09 26.07%
PDF Solutions Inc 438.29 5.30 7.16 -2.23% $0.0 $0.03 6.25%
Aehr Test Systems 34.92 8.03 8.78 6.0% $0.0 $0.01 93.27%
inTest Corp 11.84 1.58 1.09 3.18% $0.0 $0.02 6.15%
Average 53.45 6.14 4.77 5.54% $0.32 $0.47 -3.48%

When conducting a detailed analysis of ASML Holding, the following trends become clear:

  • A Price to Earnings ratio of 33.86 significantly below the industry average by 0.63x suggests undervaluation. This can make the stock appealing for those seeking growth.

  • With a Price to Book ratio of 21.51, which is 3.5x the industry average, ASML Holding might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.

  • The stock's relatively high Price to Sales ratio of 9.62, surpassing the industry average by 2.02x, may indicate an aspect of overvaluation in terms of sales performance.

  • The Return on Equity (ROE) of 16.76% is 11.22% above the industry average, highlighting efficient use of equity to generate profits.

  • The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $2.36 Billion, which is 7.37x above the industry average, indicating stronger profitability and robust cash flow generation.

  • The company has higher gross profit of $3.46 Billion, which indicates 7.36x above the industry average, indicating stronger profitability and higher earnings from its core operations.

  • The company's revenue growth of 15.48% exceeds the industry average of -3.48%, indicating strong sales performance and market outperformance.

Debt To Equity Ratio

The debt-to-equity (D/E) ratio gauges the extent to which a company has financed its operations through debt relative to equity.

Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.

When comparing ASML Holding with its top 4 peers based on the Debt-to-Equity ratio, the following insights can be observed:

  • When considering the debt-to-equity ratio, ASML Holding exhibits a stronger financial position compared to its top 4 peers.

  • This indicates that the company has a favorable balance between debt and equity, with a lower debt-to-equity ratio of 0.38, which can be perceived as a positive aspect by investors.

Key Takeaways

ASML Holding has a low PE ratio compared to its peers in the Semiconductors & Semiconductor Equipment industry, indicating that it may be undervalued. The company also has a high PB ratio, suggesting that investors are willing to pay a premium for its book value. Additionally, ASML Holding has a high PS ratio, indicating that it may be overvalued based on its sales. On the other hand, the company's high ROE, EBITDA, gross profit, and revenue growth suggest strong financial performance compared to its industry peers.

This article was generated by Benzinga's automated content engine and reviewed by an editor.

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