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- The Low-Key MVP š¤«
The Low-Key MVP š¤«
Gainersš & Losersš
Our Biggest Gainers & Losers of the Day in the $100,000 Build Portfolio
For the 3rd December 2024:
The Low-Key MVP š¤«
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The Low-Key MVP š¤«
Iām looking for the low-key MVPs of the tech world. Nothing flashy like Tesla or hyped-up like Nvidia. Something under the radar where thereās value to be had.
Yesterday I had TSMC, today Iāve gotā¦. š„ ā¦ ASML!
My current holding in ASML isnāt looking great but greatness takes time & patience.
The Elevator Pitch š
ASML is basically the only company making EUV lithography machines. Those machines help make the smartest chips going. Without ASML, thereās no AI boom, no cutting-edge semiconductors, & definitely no fancy chips in your latest iPhone.
What a beautiful spot to find yourself in.
ASMLās tech is a non-negotiable. AI data centers, cutting-edge semiconductors & all the latest gadgets need it. Itās not a ānice to haveā. Itās a āmust haveā.
This is the tech changing the world. Looks like itās straight from a spaceship.
And that podium position showed up in the stock price. They killed it in 2022-23. Share price flew up 215% from $350 to $1,100. š
But have you heard that old, classic phrase? It goes a little something like āwhat goes up, must come downā.
ASML didnāt get an exemption pass.
ASML in the Discount Bin šļø
The stockās now down 40% since July. Theyāve had a few things working against them. Here they are to bring you up to speed:
Since July, ASML has fallen as much as 40%. Weāre currently 33% down from July highs.
1/ Overcooked: It shot up too fast & needed a breather. Very, very rarely do stocks just go parabolic. Healthy growth means you need to cool off every once in a while. You wouldnāt win a marathon if you sprinted from the finish line, right? šāāļø
2/ China drama: Tariff talk spooked investors. Get ready for more of where this come from. Itās Trumpās new buzz word.
3/ Guidance woes: Sales forecast for 2025 dropped from āgreatā to āgoodā. Cue the overreaction sell-off.
Since the end of October itās found some legs around $605 & has been pretty range bound since then so we mightāve found a bottom.
I liked ASML in the $800ās so youād be right to think I love it at $600. Thatās exactly whyā¦.
Iām Buying the Dip š
ASML isnāt some one-hit wonder. Their fundamentals still slap. $8.13 billion in quarterly revenue, a strong position in the AI boom & a price-to-earnings ratio thatās practically the best itās ever been, Iām really struggling to come up with a bear case.
ASMLās P/E ratio over the last 5 years. Weāre in a great spot for a value buy
The global AI market is growing at 36% per year!. That growth cannot happen without the machines ASML are providing.
Projections have their earnings climbing from ~$26/share in 2025 to ~$32 in 2026.
Thatās why most of wall street have ā$900+ in 12 monthsā written next to ASML in their notebooks. Some have even come up with $1,100+ whichād make it a 62% gain. š¤Æ
I fall more in the conservative camp & expect weāll see somewhere around $930ish in the not so distant future.
A push to $930 still leaves me with a near 37% gain from current price
Risks? Of Course. š»
I said Iād struggle with a bear case & I think the biggest risks are the general market & thingās weāve already had a taste of.
Tariff trouble with China could slow things down a little. And if AI as a whole slows down then there wonāt be any need for ASMLās fancy machinery.
I think these are very fringe worries. Theyāve navigated through things like this before & their near-monopoly status on essential tech makes it tough to bet against them.
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Thatās all! See you same time tomorrow š
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