On Friday, the Dutch government announced a new regulation aimed at limiting the export of specialized chip-making equipment to China. Effective September 1, companies intending to export such gear will be required to apply for a specific export license. Liesje Schreinemacher, the Dutch Minister for Foreign Trade and Development Cooperation, stated the move was taken in the interest of national security and was designed to give affected companies sufficient time to adjust to the new regulation.
Meanwhile, Reuters reports suggest that the U.S. is also planning to impose additional restrictions on equipment sales to Chinese chip manufacturers. Older DUV models from ASML (NASDAQ:ASML), a Netherlands-based company, may face export restrictions to six Chinese facilities under a new rule, primarily due to their inclusion of U.S. parts. These restrictions are likely to affect a fabrication plant operated by SMIC, China’s largest chipmaker, as ASML’s systems comprise U.S. components. The new U.S. rule, expected to be released in late July, is part of a broader strategy to restrict China’s access to crucial future technologies.
Is ASML Holding a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on ASML stock based on 2 Buys, one Hold, and zero Sells assigned in the past three months, as indicated by the graphic above. In addition, the average price target of $806 per share implies 11.44% upside potential.
