Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
NEW YORK (
) has been reiterated by TheStreet Ratings as a buy with a ratings score of A . The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.
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Highlights from the ratings report include:
- Compared to its closing price of one year ago, ASML's share price has jumped by 66.38%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, ASML should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- ASML's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, ASML has a quick ratio of 1.67, which demonstrates the ability of the company to cover short-term liquidity needs.
- 48.00% is the gross profit margin for ASML HOLDING NV which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 23.80% is above that of the industry average.
- The revenue fell significantly faster than the industry average of 13.9%. Since the same quarter one year prior, revenues fell by 35.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, ASML HOLDING NV's return on equity significantly exceeds that of both the industry average and the S&P 500.
ASML Holding N.V., through its subsidiaries, engages in designing, manufacturing, marketing, and servicing semiconductor processing equipment used in the fabrication of integrated circuits. The company has a P/E ratio of 77.9, above the average electronics industry P/E ratio of 14.5 and above the S&P 500 P/E ratio of 17.7. ASML has a market cap of $23.51 billion and is part of the
industry. Shares are up 37.9% year to date as of the close of trading on Friday.
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--Written by a member of TheStreet Ratings Staff.