TSMC has made the financial and technology sectors sit up and take notice with the announcement of a massively increased investment plan. The plan is also likely to have an impact on ASML.
• TSMC plans higher investments, production of advanced logic chips is expected to increase
• Demand for ASML equipment expected to strengthen
• Analysts reiterate buy recommendation for ASML shares
Taiwan Semicondutor Manufacturing (TSMC) said in its financial filing Thursday that it plans capital expenditures of $52 billion to $56 billion for fiscal 2026. According to “Investing.com,” that is around 32 percent more than the average of planned spending for 2025. The increase underpins the company’s strategic focus on advanced manufacturing technologies and reflects robust demand for high-end semiconductors.
Bernstein reiterates rating for ASML after TSMC forecast
According to Investing.com, Bernstein analyst David Dai responded to this forecast by confirming the “Outperform” rating for the Dutch chip machine manufacturer ASML. His price target for the ASML share is 1,300 euros, signaling strong upward potential for the stock. On Friday, ASML’s shares on EURONEXT in Amsterdam were temporarily 0.90 percent higher at 1,159.80 euros.
TSMC’s increased investments were accompanied by forecast revenue growth of about 30 percent year-over-year, with capex intensity of around 33 percent, the analyst said, according to the news site. At the same time, TSMC increased the proportion of its production in the area of highly developed logic processes from 70 to up to 80 percent. These processes are among the most demanding and capital-intensive segments of semiconductor manufacturing – and this is also where the greatest demand for state-of-the-art manufacturing equipment such as lithography systems, which ASML supplies, lies.
Why ASML should benefit
ASML is the world’s leading provider of lithography systems, especially the so-called EUV (Extreme Ultraviolet Lithography) machines, which are essential for the production of state-of-the-art chips. The increase in TSMC’s investment plan is interpreted by market observers as a strengthening of demand for ASML equipment because the advanced logic processes have a high “lithography intensity”. Bernstein expects growth in high-end chip equipment to be around 30 percent in 2026, with further acceleration in demand expected in 2028/29.
According to Investing.com, analyst Dai also emphasized that the concentration of TSMC’s capacity expansion on the most modern manufacturing nodes N3 and N2 ASML is particularly beneficial, as these processes have a higher dependency on lithography systems compared to the industry. In addition, ASML’s sales with TSMC businesses could grow significantly more strongly as a result of this development than previously expected by the market.
Other analysts are also confident about ASML
In addition to Bernstein, other experts were also optimistic about ASML as a result of the TSMC announcements and partially raised their price targets. According to “TipRanks,” Wells Fargo analyst Joseph Quatrochi continued to recommend buying ASML shares listed on the NASDAQ in an analysis on Thursday and increased his price target from $1,140 to $1,450. The experts at KGI Securities also reiterated their “Buy” rating on Thursday with a price target of $1,415.
Editorial team finanzen.net
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