Deep Dive: Leandro From Best Anchor Stocks Discusses ASML
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Show Notes
This week we brought back Leandro from Best Anchor Stocks to discuss the semiconductor giant ASML. Here are some questions we asked him about the company:
How’d you come across ASML as an investment?
Why are ASML’s lithography machines so important?
What are the unit economics for ASML? How can an equipment supplier achieve 40% - 50% gross margins?
What is ASML’s relationship with its customers? What is its relationship with its suppliers? Who has the most pricing power in the chain?
There are rumors the U.S. wants to ban ASML from selling its legacy equipment to China. How big of a threat to its business is this?
On the last conference call AMSL execs said they had 5 years of demand booked. How reliable do you think this is?
Is it possible for any other semiconductor company to replicate ASML’s products? Why or why not?
The re-shoring of semiconductor manufacturing in the Americas and Europe has been a big narrative. How much could this help ASML’s demand this decade?
How cyclical are ASML’s margins? Is this something you worry about as an investor?
At this recording, we are sitting at a market cap of approximately $178 billion. How do you go about valuing ASML?
Premortem: What would cause ASML to be a poor investment from here?
Disclosure: The author and podcast guests are not your financial advisors. Ryan Henderson and Brett Schafer are general partners and portfolio managers at Arch Capital. Clients of Arch Capital may hold securities discussed on this show.