The chip sector is on fire as the artificial intelligence market takes off, driving demand for semiconductors and the gear to make them. It's no surprise then that chip equipment maker ASML Holding keeps putting up terrific numbers. On Wednesday, ASML reported strong Q4 results. And, on Thursday its stock Relative Strength (RS) Rating climbed from 85 to 91.
ASML stock jumped 25% in the last seven trading sessions, and closed higher the last seven sessions in a row. The upgraded 91 RS Rating puts ASML among the top 10% of all stocks for price performance this past year. Research shows that stocks that go on to make the biggest gains often have an RS Rating north of 80 in the early stages of their moves.
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ASML makes lithography systems, the machines that imprint chip designs onto silicon wafers to be cut up into semiconductor chips. It also provides software and services to chip companies like Intel and Nvidia.
ASML Stock A Favorite Of Big Funds
ASML Holding reported 17% earnings growth in its most recent report, to a hefty $5.74 per share. Sales grew 16% to $7.99 billion. The prior three stanzas ASML recorded EPS gains of 180%, 45% and 21%. Those gains came on sales growth of 87%, 32% and 25% during that period.
Among its other key ratings, the Netherlands-based company has a near-best 97 Earnings Per Share Rating out of 99. And ASML stock has a 98 Composite Rating, and an A SMR Rating (sales + profit margins + return on equity) on an A-to-E scale with A outstanding and E dismal.
Sometimes a company can have mostly strong ratings but institutional investors like insurance funds and mutual funds just aren't interested. That's not the case with ASML stock. It's a favorite of big money funds and has an A Accumulation/Distribution Rating on an A+ to E scale.
Up 25% In A Week, Closed Higher 7 Days In Row
ASML stock, which is on the IBD Big Cap 20 screen, has risen more than 5% past a 765.79 entry in a first-stage cup with handle, meaning it's now out of a proper buy range. Look for the stock to offer a new chance to pick up shares like a three-weeks tight or pullback to the 50-day or 10-week line.
ASML stock earns the No. 2 rank among its peers in the Electronics-Semiconductor Equipment industry group. Small cap chip gear make ACM Research is the No. 1-ranked stock in the group. Photronics, which makes the masks, or templates, used to imprint chip designs on silicon wafers, is No. 3.
As you try to find the best stocks to buy and watch, be sure to pay attention to relative price strength. IBD's unique Relative Strength Rating measures share price performance with a 1 (worst) to 99 (best) score. The rating shows how a stock's price performance over the last 52 weeks holds up against all the other stocks in our database.
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