10 Best AI Stocks to Buy According to Reddit

7. ASML Holding NV (AMS:ASML)

Number of Hedge Fund Holders: 81

ASML Holding NV (AMS:ASML) makes and sells advanced semiconductor equipment systems. Its machines are used to create the intricate patterns on silicon wafers that form the foundation of modern electronics, producing the chips that power everything from smartphones to computers and cars. It has developed a new EUV scanner that enables customers to create custom High NA EUV use cases. This breakthrough machine can produce some of the smallest chips currently available.

Driven by AI-related demand for both Logic and Memory and improvements in inventory levels, the company recorded a $6.83 billion revenue for Q2 2024. However, there was a year-over-year decline of 11.69%.

The primary reason for the decline was geopolitical tensions. A recent Bloomberg report sparked investor concerns about potential US restrictions on chip equipment exports to China. This could significantly impact ASML’s business, as China is a major customer, especially for older-generation chipmaking tools.

The company’s stock price fell 10% due to the uncertainty surrounding potential US restrictions on chip equipment exports to China. A recent Bloomberg report sparked investor concerns regarding this situation as China is a major customer, especially for older-generation chipmaking tools. Still, by the end of this quarter, 81 hedge funds were long in the company, with the largest stake amounting to $3,226,042,315 by Fisher Asset Management.

Recently, Dutch Prime Minister Dick Schoof said that the government will consider the economic interests of ASML Holding NV (AMS:ASML) when deciding on further tightening the rules governing the export of its computer chip-making equipment to China.

Despite the stock price drop under these circumstances, the company maintains its 2024 “transition year” outlook, anticipating a recovery in 2025. It remains optimistic about the strong growth potential in AI, which is driving demand for its advanced EUV equipment.

Polen International Growth Strategy stated the following regarding ASML Holding N.V. (NASDAQ:ASML) in its fourth quarter 2023 investor letter:

“Netherlands-based ASML Holding N.V. (NASDAQ:ASML) and Japan-based Lasertec play dominant roles within different segments of the global semiconductor industry. In both cases, shares rallied significantly in the fourth quarter of 2023, prompting our positions to grow as a percentage of the overall portfolio. We believe both companies will see demand for their products as extreme ultraviolet (EUV) lithography and soon high-numerical aperture lithography must be utilized to manufacture the world’s smallest chips. However, in our estimation, 2024 could deliver a year of less exciting growth for the semiconductor industry, which prompted us to trim these positions back.”