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What do the Fundamentals Predict for ASML Holding NV (ASML) Stock?

Friday, August 19, 2022 10:46 AM | InvestorsObserver Analysts
What do the Fundamentals Predict for ASML Holding NV (ASML) Stock?

InvestorsObserver gives ASML Holding NV (ASML) a strong valuation score of 64 from its analysis. The proprietary scoring system considers the underlying health of a company by analyzing its stock price, earnings, and growth rate. ASML currently holds a better value than 64% of stocks based on these metrics. Long term investors focused on buying-and-holding should find the valuation ranking system most relevant when making investment decisions.

Valuation Rank - 64
ASML gets a 64 Valuation Rank today. Find out what this means to you and get the rest of the rankings on ASML!

Metrics Analysis

ASML has a trailing twelve month Price to Earnings (PE) ratio of 36.6 which places it above the histroical average of roughly 15. ASML is currently trading at a poor value due to investors paying more than what the stock is worth in relation to its earnings. ASML's trailing-12-month earnings per share (EPS) of 6.54 does not justify its share price in the market. Trailing PE ratios do not factor in the company's projected growth rate, thus, some firms will have high PE ratios caused by high growth recruiting more investors even if the underlying company has produced low earnings so far.
ASML's 12-month-forward PE to Growth (PEG) ratio of 1.74 is considered a poor value as the market is overvaluing ASML in relation to the company's projected earnings growth due. ASML's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.

Summary

ASML's valuation metrics are weak at its current price due to a overvalued PEG ratio despite strong growth. ASML's PE and PEG are worse than the market average resulting in a below average valuation score. Click Here to get the full Report on ASML Holding NV (ASML) stock.

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