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ASML (ASML) Moves 9.5% Higher: Will This Strength Last?

ASML (ASML) shares soared 9.5% in the last trading session to close at $1,041.34. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 4.7% gain over the past four weeks.

ASML Holding extended its rally, driven by the fact that it has become Europe’s second-biggest listed company. Moreover, its biggest client called Taiwan Semiconductor is gearing up to receive the high-NA extreme ultraviolet machine by the end of this year, which bodes well for ASML.

This equipment supplier to semiconductor makers is expected to post quarterly earnings of $3.87 per share in its upcoming report, which represents a year-over-year change of -27.9%. Revenues are expected to be $6.35 billion, down 15.6% from the year-ago quarter.

While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.


For ASML, the consensus EPS estimate for the quarter has been revised marginally higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on ASML going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

ASML belongs to the Zacks Semiconductor Equipment - Wafer Fabrication industry. Another stock from the same industry, Lam Research (LRCX), closed the last trading session 5.3% higher at $971.72. Over the past month, LRCX has returned 0.9%.

For Lam Research , the consensus EPS estimate for the upcoming report has changed +0.6% over the past month to $7.52. This represents a change of +25.8% from what the company reported a year ago. Lam Research currently has a Zacks Rank of #3 (Hold).

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