ASML Stock Keeps Sliding On China’s Latest Chip Advance — Why BofA Calls Selloff An ‘Overreaction’ And Sees Over 70% Upside

• Bank of America reiterated its ‘Buy’ rating and $2,845 price target, implying nearly 72% upside from Monday’s close.
• Stocktwits traders echoed BofA’s view, saying China could take years to scale production and close the technology gap with ASML.
• Wall Street remains bullish on ASML, with 40 of 44 analysts rating the stock ‘Buy’ or ‘Strong Buy,’ according to Koyfin data.

Shares of ASML Holding NV (ASML) continued to decline on Tuesday as investors weighed concerns over a potential new threat from China’s semiconductor equipment ambitions. However, Bank of America said investors are overreacting to the developments and reiterated its bullish view on the chip equipment maker.

At the time of writing on Tuesday midday, ASML stock was down around 4% after extending losses from the previous session following a report that a Chinese state-backed company had started manufacturing immersion deep ultraviolet (DUV) lithography machines.

China Threat To ASML Is Limited, BofA Says

Bank of America reiterated its ‘Buy’ rating on ASML and maintained its $2,845 price target for U.S.-listed shares. The target represents nearly 72% upside from Monday’s close, with the bank also naming ASML a “top pick,” according to a report in CNBC.

Bank of America said the threat from China remains modest, adding that replacing ASML would require a domestic alternative with comparable productivity, overlay, and cost of ownership.

“China remains an important market for ASML, accounting for roughly 20% of group sales and 44% of DUV revenue in 2026,” the Bank of America analyst wrote in the note.

China Competition Impact Seen As Manageable

Bank of America said that even if China can source 20 argon fluoride immersion tools — the category under which DUV machines fall — locally, it would impact only €1.4 billion (nearly $1.6 billion) of ASML’s sales in 2027.

That figure represents just 2.4% of the Dutch company’s group sales, which Bank of America said makes the recent selloff overdone.

Referring to Monday’s price action, Bank of America said, “We think today’s weakness is an overreaction and see current levels as an attractive opportunity.”

ASML Stock: What Stocktwits Retail Sentiment Says

On Stocktwits, retail sentiment for ASML jumped to ‘bullish’ from ‘bearish’ a day ago, while message volume improved to ‘normal’ from ‘low’ during the same period.

Over the past 30 days, message volume around the stock has surged by a whopping 13,000%, while the ticker’s watcher base has risen 3% during the same period, indicating steady growth of retail interest in the stock.

Stocktwits traders echoed BofA’s view that China’s DUV push is unlikely to pose an immediate threat to ASML.

One retail trader said semiconductor supply constraints could persist for years, adding that “even with the Chinese homegrown DUV coming online,” it could take “years” before they contribute meaningful production output.

Another trader said China could take “many years to catch up” with ASML, adding that ASML is likely to stay ahead as it continues to advance its technology. “Their newest machines have 100,000 parts, 5,000 suppliers from different countries and specialized engineers. All of this took decades to develop. China will not be able to catch up for the foreseeable future,” said the trader.

Analysts remain broadly positive on ASML. According to data from Koyfin, 40 of the 44 analysts covering ASML rate it ‘Buy’ and ‘Strong Buy,’ while three rate it ‘Hold’ and one rates it ‘Sell.’

ASML stock has gained nearly 49% year-to-date.

Also See: ETON Stock Jumps 10%: Why Does This Analyst See 47% Upside To Stock?

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