Recently ASML Holding N.V. (NYSE:ASML) bought 4.6% of its stake. (NASDAK:NASDAK:ASML) (OTCPK:ASMLF) In January 2024, discuss why we think its 2024 outlook is prudent as major technology companies and data center REITs continue to report growing cloud computing and generative artificial intelligence projects. and the use of infrastructure.
However, given that the fund has recovered significantly from its recent crash in October 2023, we recommend that interested investors wait for another attractive upgrade.
Since then, ASML has posted another gain of +39.8%, outperforming the broader market by +9.1%. However, we see insatiable demand for AI SaaS and double-digit growth for Nvidia ( NVDA ) as reasons to continue to dominate the next strong year.
Despite the development and emergence of security, readers may want to travel to the improved security section, as there is not one interesting moment hidden here.
ASML’s long-term investment outlook is promising even in its current state.
As ASML announces FK1’24 earnings on April 17, 2024, all eyes will be on whether they can continue their winning streak since 2010 and avoid another loss in 2021.
For context, the lithography company reported best-in-class 2023 fiscal year sales of €27.55 billion (+30.1% YoY) and subsequent earnings per share of €19.91 (+40.8% YoY) as well as impressive cash reserves. 20.04 billion (-34.6%). /y) and close at 39 billion (-3.4% y/y).
Figures show strong demand for ASML’s core retail offering despite competition from Canon ( OTCPK:CAJPI ) ( OTCPK:CAJFF ).
The latter It reported slower company sales of ¥314.7 billion (-4.4% YoY) at ¥314.7 billion (-4.4% YoY), driven by weak performance of FPD lithography equipment due to growth in semiconductor lithography equipment sales.
ASML Holding N.V.’s (AMS:ASML) Stock Is Going Strong: Is the Market Following Fundamentals?
Shares of ASML Holding ( AMS:ASML ) are up 40 percent over the past three months. Given that businesses tend to reward strong economic performance over the long term, we wonder if that’s the case here. In this section, we have decided to focus on ASML Holding’s ROE.
Return on equity, or ROE, is important to shareholders because it tells them how much their money will change. Simply put, it is used to calculate a company’s return on equity.
How Do You Calculate Return On Equity?
The formula for ROE is:
Return on equity = profit (from continuing operations) ÷ stockholders’ equity
Therefore, according to the above formula, ASML Holding’s ROE is:
58% = €7.8 billion ÷ €13 billion (based on data for the last twelve months to December 2023).
“Results” refers to the company’s earnings for the previous year. Another way to think of this is that for every €1 a share, the company earns €0.58 in profit.
What Has ROE Got To Do With Earnings Growth?
We have already seen that ROE is a good indicator of a company’s future earnings profitability. Now we need to calculate how much profit the company will make or “continue” growth in the future, which will give us the opportunity to grow the company. In general, other things being equal, firms with high equity and equity returns have higher growth rates than firms that do not share these characteristics.
ASML Holding’s Earnings Growth And 58% ROE
First, we like ASML Holding, which has impressive ROE. Second, even compared to the industry average of 15%, the company’s ROE is impressive. Therefore, ASML Holding’s high revenue growth of 26 percent over the last five years is not surprising.
As a next step, we compared ASML Holding’s revenue growth to the industry’s growth rate and found that the industry has seen similar growth compared to the industry average growth of 31% over the same period.
Blog By:- ExpertSadar
