Is NASDAQ:ASML on the Verge of a Major Breakout as a Strong Growth Stock?

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.

Looking at the Growth

ChartMill assigns a Growth Rating to every stock. This score ranges from 0 to 10 and evaluates the different growth aspects like EPS and Revenue, both in the past as in the future. NASDAQ:ASML scores a 8 out of 10:

• ASML shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 40.47%, which is quite impressive.
• Measured over the past years, ASML shows a very strong growth in Earnings Per Share. The EPS has been growing by 26.71% on average per year.
• ASML shows a strong growth in Revenue. In the last year, the Revenue has grown by 30.15%.
• Measured over the past years, ASML shows a very strong growth in Revenue. The Revenue has been growing by 20.29% on average per year.
• ASML is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 17.71% yearly.
• The Revenue is expected to grow by 9.30% on average over the next years. This is quite good.

A Closer Look at Health for NASDAQ:ASML

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:ASML has earned a 7 out of 10:

• ASML has an Altman-Z score of 9.92. This indicates that ASML is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of ASML (9.92) is better than 82.08% of its industry peers.
• ASML has a debt to FCF ratio of 1.36. This is a very positive value and a sign of high solvency as it would only need 1.36 years to pay back of all of its debts.
• ASML has a better Debt to FCF ratio (1.36) than 72.64% of its industry peers.
• A Debt/Equity ratio of 0.29 indicates that ASML is not too dependend on debt financing.
• 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.

Exploring NASDAQ:ASML's Profitability

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:ASML, the assigned 9 is a significant indicator of profitability:

• Looking at the Return On Assets, with a value of 18.84%, ASML belongs to the top of the industry, outperforming 89.62% of the companies in the same industry.
• The Return On Equity of ASML (50.07%) is better than 97.17% of its industry peers.
• Looking at the Return On Invested Capital, with a value of 29.98%, ASML belongs to the top of the industry, outperforming 98.11% of the companies in the same industry.
• The Average Return On Invested Capital over the past 3 years for ASML is significantly above the industry average of 11.60%.
• The last Return On Invested Capital (29.98%) for ASML is above the 3 year average (29.47%), which is a sign of increasing profitability.
• ASML's Profit Margin of 29.45% is amongst the best of the industry. ASML outperforms 91.51% of its industry peers.
• In the last couple of years the Profit Margin of ASML has grown nicely.
• With an excellent Operating Margin value of 34.52%, ASML belongs to the best of the industry, outperforming 92.45% of the companies in the same industry.
• In the last couple of years the Operating Margin of ASML has grown nicely.
• ASML has a Gross Margin of 49.98%. This is in the better half of the industry: ASML outperforms 63.21% of its industry peers.
• ASML's Gross Margin has improved in the last couple of years.

Why is NASDAQ:ASML a setup?

Besides the Technical Rating, ChartMill assigns a Setup Rating to every stock to determine the degree of consolidation. This rating, ranging from 0 to 10, is updated daily and evaluates various short-term technical indicators. NASDAQ:ASML currently holds a 7 as its setup rating, suggesting a particular level of consolidation in the stock.

Besides having an excellent technical rating, ASML also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. A pullback is taking place, which may present a nice opportunity for an entry. There is very little resistance above the current price. There is a support zone below the current price at 968.77, a Stop Loss order could be placed below this zone.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

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

For an up to date full technical analysis you can check the technical report of ASML

Keep in mind

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.