We’re gonna talk about a topic that’s barely getting any attention: the chip sector (wink, wink) . It’s the lifeblood of everything from your overpriced smartphone to the AI bots writing cringy LinkedIn posts and spamming my inbox with “Let’s connect!” messages. But right now, it feels like someone spilled their piping hot latte on the motherboard. Nvidia is down 13% in the last five days, Taiwan Semiconductor is off 8%, and YouTube’s top finance video is shouting about a semiconductor apocalypse that would make 1929 look like a walk in the park.

Sure, there’s pessimism swirling around the sector. High interest rates staying around longer, Trump tariff concerns, and the realization that not everyone needs a $3,000 AI GPU to run "Fortnite" have put the sector on edge. But in the middle of this firestorm, one name is quietly sitting in the coals, primed for a comeback: ASML Holding. I’m sure you’ve barely heard of ASML. That’s because Nvidia and TSMC hog the stage, like the headliners at Coachella. But ASML is the guy in the background running the soundboard… without it, the whole concert falls apart.

Alright, let me grab my nerd glasses and explain why ASML matters (don’t worry, I promise it’s worth it). They’re the geniuses behind extreme ultraviolet (EUV) lithography machines… basically, the unsung heroes of advanced chip production. These machines are engineering marvels, using lasers to fire at molten tin droplets 50,000 times per second to etch the intricate designs that make chips work. Each one comes with a price tag of $220 million, and their next-gen models crank that up to $380 million. It’s safe to say these are some of the most advanced (and most expensive) tools driving the tech world forward.

(Source: Wired)

Here’s why I’m so hopeful for the stock. ASML has a monopoly on this tech. China’s trying to catch up, but according to analysts, their odds of replicating EUV machines in the next 15 years are about as good as Robinhood not running a corrupt business (impossible). ASML’s stock is down nearly 30% from its peak last summer, and the reasons are as complicated as its machines. For starters, China rushed to stockpile older ASML tech before potential U.S. export bans hit harder, creating a temporary demand drop. Add in Intel and Samsung delaying equipment orders and the ongoing slump in consumer devices, and you’ve got a recipe for short-term pain.

But what really gets me excited is that ASML still holds a $38 billion backlog in orders. And while TSMC may not need its latest high-NA EUV machines until 2030, demand for older-generation nodes remains strong. Plus, as AI and renewable energy adoption grow, ASML’s role in enabling these technologies becomes even more critical. Bank of America Securities analyst Didier Scemama expects ASML’s earnings to grow at a compounded annual rate of 16% over the next five years. Sure, the stock trades at 37 times this year’s earnings (not exactly cheap), but Scemama points out that this is near a 10-year low compared to U.S. peers. And he’s calling for a 26% upside on the stock. I actually think that’s a slam dunk.

So anyways, while Nvidia and TSMC hog up your twitter feed, ASML quietly remains the backbone of the chip sector. Let’s revisit this article a year from now, of course I could be wrong, but I feel pretty good about this one (assuming we don’t actually have a chip apocalypse.)

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Stock.News has positions in Robinhood and Intel.