Morgan Stanley Lowers Investment Rating on Semiconductor Equipment Company ASML to 'Neutral'

Morgan Stanley has downgraded its investment rating for Dutch semiconductor equipment company ASML from 'Overweight' to 'Neutral.'

According to Reuters and other sources, on the 20th (local time), Morgan Stanley lowered ASML's investment rating and cut its target price by 13.5%, from 925 euros (1.39 million KRW) to 800 euros (1.19 million KRW). Morgan Stanley cited the DRAM market, Intel's poor performance, and uncertainties related to Chinese demand as reasons for the adjustment.

Intel, facing a crisis due to deteriorating earnings, has decided to spin off its foundry (semiconductor contract manufacturing) division and suspend construction of its German factory for two years. Morgan Stanley stated, "Concerns are growing that the pace of semiconductor investment in China will slow down as we approach 2026."

The Chinese market mainly uses older deep ultraviolet (DUV) lithography equipment but accounted for nearly half of ASML's total sales in the second quarter. However, Morgan Stanley noted that TSMC is expected to place many orders for cutting-edge extreme ultraviolet (EUV) lithography equipment related to artificial intelligence (AI) next year, and based on past cases, investors should avoid taking an overly negative stance before the order cycle peaks.

Earlier, UBS and Deutsche Bank also lowered their earnings forecasts and target prices for ASML. ASML's stock price fell 4.2% to 716.7 euros that day. Morgan Stanley recently changed its investment rating for SK Hynix from 'Overweight' to 'Underweight' and lowered the target price from 260,000 KRW to 120,000 KRW.

This content was produced with the assistance of AI translation services.