ASML/ASMI: Feedback from investor meetings & thoughts into results

Over the last four weeks we met with over 70 investors in Europe and Asia. Investors in Europe appeared generally positive on semiconductor capital equipment stocks, driven by rising visibility into 2028, while those in Asia appeared more lukewarm, focusing on whether much of the expected WFE growth over 2027/28 is already priced in and where additional upside may come from. We raise our ASML target price to EUR2,177 (from EUR2,149, Buy) on modest upgrades to EUV gross-margin assumptions; our 2027 revenue/EPS are 3%/7% ahead of consensus and 2028 9%/12% ahead, with every 1ppt higher gross margin adding ~2.2% to 2027 EPS. We raise our ASM International target price to EUR1,230 (from EUR1,116, Buy) on higher gross-margin and operating-leverage assumptions; our 2027 street-high revenue/adjusted EPS are 8.6%/9.7% ahead of consensus. ASML reports on 14 October and ASMI on 27 October. Target prices imply 33.5%/36.9% upside; we maintain Buy ratings.