ASML (NASDAQ:ASML) and Micron (NASDAQ:MU) shares haven’t been the hottest of semiconductor plays in recent years, to say the least. And while both firms stand to gain as the AI data center boom takes off to new heights, investors don’t seem all too convinced that they’ll stand nearly as tall as some of the other AI names out there amid Trump tariff threats and more cautious optimism regarding guidance, rather than the kind of table-pounding bullishness we’ve heard from most other firms that are ready for another big years of AI-induced tailwinds.
Indeed, ASML and Micron do face unique risks and challenges compared to rivals. But as the AI waters rise, it’ll lift most boats, and with less in the way of guidance and expectation moving into 2026, perhaps the bar is low enough such that both relative AI laggards can deliver a positive surprise. In any case, I view both names as worthy additions to a value-oriented portfolio that’s looking for a cheaper way to benefit from the AI revolution over an extended period of time.
While ASML and MU shares won’t rocket overnight, I do view them as top value picks for investors looking for reasons to justify showing up late (if it is still, in fact, late) to the AI party.
Key Points
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ASML and MU may be guiding cautiously, but the AI tailwind is still very much in play.
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Don’t doubt the value to be had in the names, especially now that there’s a lower bar to pass and a lower price of admission for new investors.
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ASML
ASML is a Dutch lithography machine maker that maintains a solid, monopolistic footing in the semiconductor lithography equipment market. For the big manufacturers, ASML provides the goods that no other firm can match. While industry conditions could cause some fabs to pull back on spending on new equipment, I do think that ASML remains a solid long-term option for investors willing to ride out the big waves in the stock.
Indeed, the semi equipment makers may not be as exciting as the top plays in GPUs, ASICs, or semi manufacturing. However, I do see secular tailwinds prevailing as the firm makes it through a turbulent next 18 months or so if a bear-case scenario unfolds with President Trump’s tariffs. Personally, I think management is smart to guide more cautiously.
After all, it’s hard to predict the future when tariffs may be either much higher, much lower, or (mostly) gone in a year from now. With shares fresh off a 35% plunge, I think it’s time to start building a position, as ASML buys back its own stock while investors flee ahead of a potentially turbulent 2026.
At just 25.7 times trailing price-to-earnings (P/E), you’re getting AI growth at a fairly reasonable multiple.
Micron
Micron is a memory chip maker that’s had a rather turbulent past year and a half. The stock has had a few melt-ups and big-time busts in the timespan. And with Hedgeye analyst Felix Wang calling for some profit-taking (not a bad idea after a 45% gain in three months), questions linger as to the next direction for the maker of high-performance memory.
Now, it’s still very much in the AI race, as AI data centers go online to meet soaring demand for AI applications. That said, there is competition in memory chips, making it difficult to forecast just how much of a slice Micron will end up with after the ongoing data center demand boom. Management’s conservative guidance may have scared some, but I do think it’ll be tough to keep the stock down for all too long.
Personally, I see Micron, a hedge fund favorite in recent years, as not only a value play but one of the cheapest ways to profit from the AI revolution. The stock trades at 9.1 times forward P/E, which is an absurd discount for an AI beneficiary that already has a low bar to pass for its coming quarters. Although I’m also a fan of ASML, I must say that MU stock appears to offer more in the way of value.
The post ASML vs. Micron Technology (MU): Which Semiconductor Stock is a Better Value? appeared first on 24/7 Wall St..
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Author: Joey Frenette
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