ASML’s Buyback Blitz Bolsters Analyst’s 1,700-Euro Call as AI Orders Lift Outlook

ASML's €12B buyback programme continues near record highs; Bernstein reiterates outperform with €1,700 target. AI-driven EUV demand boosts 2026 revenue guidance to €36-40B.

ASML’s shares have surged more than 40% this year, yet the company’s own treasury desk is still snapping up stock at elevated levels. In the week through 22 May, the Dutch lithography heavyweight repurchased 60,461 of its own shares for a total of €79.36 million, paying an average price of €1,312.63. The buyback programme, announced on 28 January, allows for up to €12 billion in repurchases through 2028, with most of the acquired stock set to be cancelled. The move underscores management’s confidence even as the stock hovers just 2.5% below its 52-week high of €1,420.80.

That conviction is matched by one of the most bullish analysts on the Street. Bernstein’s Qingyuan Lin this week reiterated his “outperform” rating and €1,700 price target, implying roughly 21% upside from current levels. Lin’s target stands well above the consensus average of about €1,483, which itself points to a 6% gain. The call rests on a foundation of robust demand for the company’s extreme ultraviolet (EUV) lithography systems, driven by the build-out of artificial intelligence infrastructure.

ASML’s first-quarter results lend weight to that optimism. Net revenue came in at €8.8 billion, with a gross margin of 53.0% and net profit of €2.8 billion. For the current quarter, the company guided for revenue between €8.4 billion and €9.0 billion and a gross margin of 51% to 52%. Looking to the full year 2026, management raised its revenue forecast to a range of €36 billion to €40 billion, with gross margin expected to land between 51% and 53%. The improving outlook reflects customers lifting their near- and medium-term demand expectations as they rush to add chip capacity for AI workloads.

The buyback programme itself has been active from the start. In the first quarter alone, ASML repurchased shares worth roughly €1.1 billion. Under the current scheme, up to two million shares are earmarked for employee compensation, with the remainder destined for cancellation – a move that directly boosts earnings per share. Recent buybacks have occurred at weighted average prices as high as €1,392.69, showing that ASML is willing to pay up for its own equity even after the stock’s stellar run.

Still, the bullish narrative is not without its risks. The wide revenue guidance band for 2026 explicitly incorporates potential fallout from ongoing export control discussions. While AI demand provides a powerful tailwind, geopolitical restrictions on chip equipment sales – particularly to China – could cap the upside. ASML itself expects second-quarter revenue of €8.4 billion to €9.0 billion, and the market will be watching closely to see whether order momentum can overcome the regulatory headwinds. For now, the combination of record buybacks, rising guidance, and a bold analyst target suggests that investors are betting the positives will win out.