On July 13, 2026, we present a DCF analysis for ASML Holding NV ASML, a company that has shown impressive price performance with a year-to-date increase of 68.6% and a remarkable 125.8% rise over the past year. Below are key insights from our analysis:
- DCF Earnings-based intrinsic value of $1276.44 vs current price of $1797.32 (margin of safety: -67.2%)
- DCF FCF-based intrinsic value of $1155.93 vs current price (second opinion: -55.5% margin of safety)
- GF Score™ of 90/100 indicating strong reliability of the DCF inputs
What Is ASML Worth? DCF Earnings-Based Model
To determine the intrinsic value of ASML, we utilized a two-stage DCF model. The first stage accounts for a high growth phase, while the second stage reflects a more stable growth period. Below are the assumptions used in our analysis:
| Parameter | Value |
|---|---|
| Current EPS (TTM, excl. non-recurring) | $31.24 |
| 10-Year Growth Rate | 24.0% |
| 10-Year Treasury Rate | 4.58% |
| Discount Rate (ceil(Treasury) + 6%) | 11% |
| Terminal Growth Rate | 4% |
In the first stage, we project the EPS to grow at 24.0% per year for the next 10 years, discounted at a rate of 11%. The calculated value for this growth stage is $603.96 per share. In the second stage, we assume a terminal growth rate of 4% for the following 10 years, which results in a terminal stage value of $672.48 per share. The summary of our calculations is as follows:
| Stage | Description | Value |
|---|---|---|
| Growth Stage (Years 1-10) | EPS growing at 24.0%, discounted at 11% | $603.96 |
| Terminal Stage (Years 11-20) | 4% terminal growth, discounted at 11% | $672.48 |
| Intrinsic Value | Growth + Terminal | $1276.44 |
Comparing the current price of $1797.32 to the intrinsic value of $1276.44 indicates that ASML is modestly overvalued, with a margin of safety of -67.2%. It is important to note that GuruFocus utilizes EPS excluding non-recurring items, as research shows stock prices correlate more closely with earnings than free cash flow. For further details, you can visit the ASML DCF Calculator.
What Does the Free Cash Flow DCF Say?
In addition to the earnings-based model, we also examined the free cash flow (FCF) DCF model, which yielded an intrinsic value of $1155.93 per share. This FCF-based valuation aligns closely with the earnings-based intrinsic value, reinforcing the conclusion that ASML is modestly overvalued, with a margin of safety of -55.5%.
How Does GF Value™ Compare to the DCF Models?
The GF Value™ for ASML is calculated at $1150.00, providing a third perspective on the company's valuation. GF Value™ is GuruFocus' proprietary measure, derived from historical trading multiples, past business growth, and future performance estimates. All three models—DCF earnings, DCF FCF, and GF Value™—indicate that ASML is currently overvalued. For more information, visit the GF Value™ page.
What Does ASML's GF Score™ Tell Us?
The GF Score™ ranks stocks from 0 to 100 based on five key aspects: Financial Strength, Profitability, Growth, Valuation, and Momentum. Stocks with higher GF Score™ values have been shown to generate higher long-term returns based on backtested data from 2006 to 2021.
| Metric | Rating |
|---|---|
| GF Score™ | 90/100 |
| Financial Strength | 6/10 |
| Profitability | 10/10 |
| Growth | 10/10 |
| Valuation | 3/10 |
| Momentum | 6/10 |
With a predictability rating of 4/5 stars, the DCF model is considered more reliable for ASML. For further insights, visit the ASML stock page.
Key Assumptions and Limitations
It is important to recognize that DCF models are highly sensitive to the assumptions made regarding growth rates and discount rates. Additionally, stocks with low predictability ratings tend to produce less reliable DCF estimates. The terminal growth rate of 4% is a simplifying assumption that may not reflect future economic conditions.
What This Means for Investors
In summary, the analysis of ASML using three different valuation models—DCF earnings, DCF FCF, and GF Value™—indicates that the stock is currently overvalued. Investors should consider this information carefully when making investment decisions. For the full DCF analysis, visit the ASML DCF Calculator. You can also explore the GF Value™ page, or use the GuruFocus Stock Screener to find undervalued predictable companies.
Frequently Asked Questions
What is ASML's intrinsic value based on DCF?
Answer: earnings-based $1074.96, FCF-based $1155.93
Is ASML overvalued or undervalued?
Answer: Based on DCF and GF Value™ consensus, ASML is overvalued.
How reliable is the DCF model for ASML?
Answer: The predictability rank of 4/5 indicates a reliable DCF model for ASML.
This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].
