BofA names the beneficiary of the Intel and Nvidia deal. Why could its stock rise 16%?

Bank of America believes that shares of Dutch chip equipment manufacturer ASML may become the main beneficiary of the deal between Nvidia and Intel for $5 billion. The bank's analyst raised the target price of the company's securities and retained the advice to buy them. BofA is convinced: strengthening of Intel's positions in the market of data centers and PCs will be a favorable factor for companies producing equipment for chip production.

Chip equipment manufacturer ASML from the Netherlands may be the main beneficiary of the deal between Nvidia and Intel for $5 billion, according to Bank of America. His opinion quotes CNBC. On Friday, BofA analyst Didier Skemama maintained his recommendation to buy ASML shares (Buy rating) and raised the target price of its receipts in the U.S. from $833 to $1082, the channel adds. Skemama's new target implies ASML's market value growth by more than 16% from the closing level on Friday, September 19.

The BofA analyst noted that although the agreement between Nvidia and Intel cannot be called a full-fledged chip contract, Intel's strengthening position in the data center and PC segments will be a positive factor for semiconductor equipment manufacturers, which include ASML. As part of the deal, Intel will integrate its processors into Nvidia's AI platforms and add the partner's graphics solutions to its own central processing units (CPUs). At the same time, the company will receive the necessary capital, which can be used to purchase equipment for chip production and cover other business expenses, CNBC notes.

The analyst also added that additional factor of growth of ASML securities will be generally increased demand for lithography equipment of the company - key machines with the help of which modern microchips are produced. It is impossible to launch new chip production lines without ASML's facilities. At the same time, new plants of Intel, Samsung and TSMC are being built in the U.S. and other countries, which means that the need for such equipment is only growing, which will directly support the company's revenue and quotations.

"In 2027, we forecast significant revenue growth for [ASML] - about +21% year-on-year - driven by the opening of several plants in the U.S.," Scemama estimated.

On trades on September 19 in New York ASML depositary receipts grew by 0.47%. During the trades the price was rising by 1.17%. Since the beginning of 2025 the market value of the company increased by 34.5%.

More than 65% of analysts who have assigned ratings to ASML advise investors to buy its securities (Buy and Overweight ratings). The rest are mostly neutral with a Hold rating and only one suggests selling the securities. Nevertheless, the Wall Street consensus target price suggests that ASML's market value could fall by almost 18% from the last closing price.

This article was AI-translated and verified by a human editor