NASDAQ:ASML: a strong growth stock preparing for the next leg up?.

Growth investors are on the lookout for stocks displaying robust revenue and EPS growth. In this analysis, we'll assess whether ASML HOLDING NV-NY REG SHS (NASDAQ:ASML) aligns with growth investing criteria, especially as it consolidates and signals a possible breakout. As always, investors should conduct their own research, but ASML HOLDING NV-NY REG SHS has surfaced on our radar for growth with base formation, warranting further examination.

Analyzing Growth Metrics

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:ASML has earned a 8 for growth:

• The Earnings Per Share has grown by an impressive 34.94% over the past year.
• Measured over the past years, ASML shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.59% on average per year.
• The Revenue has grown by 34.73% in the past year. This is a very strong growth!
• ASML shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 18.76% yearly.
• The Earnings Per Share is expected to grow by 23.83% on average over the next years. This is a very strong growth
• ASML is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 15.29% yearly.

Assessing Health Metrics for NASDAQ:ASML

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NASDAQ:ASML, the assigned 7 reflects its health status:

• An Altman-Z score of 7.12 indicates that ASML is not in any danger for bankruptcy at the moment.
• ASML's Altman-Z score of 7.12 is fine compared to the rest of the industry. ASML outperforms 70.75% of its industry peers.
• ASML has a debt to FCF ratio of 0.90. This is a very positive value and a sign of high solvency as it would only need 0.90 years to pay back of all of its debts.
• The Debt to FCF ratio of ASML (0.90) is better than 77.36% of its industry peers.
• A Debt/Equity ratio of 0.35 indicates that ASML is not too dependend on debt financing.
• Even though the debt/equity ratio score it not favorable for ASML, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
• The current and quick ratio evaluation for ASML is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

What does the Profitability looks like for NASDAQ:ASML

ChartMill assigns a Profitability Rating to every stock. This score ranges from 0 to 10 and evaluates the different profitability ratios and margins, both absolutely, but also relative to the industry peers. NASDAQ:ASML scores a 9 out of 10:

• ASML's Return On Assets of 19.80% is amongst the best of the industry. ASML outperforms 90.57% of its industry peers.
• With an excellent Return On Equity value of 60.17%, ASML belongs to the best of the industry, outperforming 97.17% of the companies in the same industry.
• Looking at the Return On Invested Capital, with a value of 33.91%, ASML belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
• Measured over the past 3 years, the Average Return On Invested Capital for ASML is significantly above the industry average of 13.00%.
• The last Return On Invested Capital (33.91%) for ASML is above the 3 year average (25.12%), which is a sign of increasing profitability.
• ASML's Profit Margin of 30.39% is amongst the best of the industry. ASML outperforms 89.62% of its industry peers.
• ASML's Profit Margin has improved in the last couple of years.
• ASML's Operating Margin of 35.21% is amongst the best of the industry. ASML outperforms 90.57% of its industry peers.
• ASML's Operating Margin has improved in the last couple of years.
• With a decent Gross Margin value of 50.11%, ASML is doing good in the industry, outperforming 60.38% of the companies in the same industry.
• ASML's Gross Margin has improved in the last couple of years.

How does the Setup look for NASDAQ:ASML

Besides the Technical Rating, ChartMill also assign a Setup Rating to every stock. This setup score also ranges from 0 to 10 and determines to which extend the stock is consolidating. This is achieved by evaluating multiple short term technical indicators. NASDAQ:ASML currently has a 8 as setup rating:

ASML has a bad technical rating, but it does show a decent setup pattern. Prices have been consolidating lately. There is a resistance zone just above the current price starting at 602.16. Right above this resistance zone may be a good entry point.

More Strong Growth stocks can be found in our Strong Growth screener.

Check the latest full fundamental report of ASML for a complete fundamental analysis.

Check the latest full technical report of ASML for a complete technical analysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.