Action ASML : -30% en 6 mois… opportunité ou danger ? (Éligible PEA)

ASML's Financial Results and Business Model Overview

Introduction to ASML

• The speaker welcomes investors and introduces the episode focused on ASML's recently published financial results.

• ASML is identified as the global leader in photolithography machines for the semiconductor industry, crucial for manufacturing electronic chips.

Business Model and Market Dynamics

• The company specializes in etching silicon to create tiny electronic chips used in AI servers and various electronic components.

• ASML's revenue for 2024 is projected at €28.2 billion with a net profit of €7.5 billion, resulting in a net margin of 26.7%.

• Revenue growth since 2019 has been inconsistent, reflecting cyclical trends similar to those seen in companies like Apple.

Revenue Fluctuations and Projections

• The speaker notes fluctuations in order books due to varying demand from clients like Taiwan Semiconductor Manufacturing Company (TSMC).

• For 2025, ASML forecasts revenues between €30 billion and €35 billion, indicating uncertainty with a growth range of +6% to +23%.

Challenges in Forecasting Growth

• The speaker expresses surprise at the wide range of projections provided by ASML, questioning their ability to predict future growth accurately.

• It’s noted that demand is cyclical; thus, predicting orders can be challenging due to the nature of large machine sales compared to more predictable consumer goods.

Market Performance Analysis

Stock Performance Post Results Announcement

• Following positive results despite concerns about revenue growth, ASML's stock saw an increase of approximately 10–12%.

• Historical data shows that since early 2020, when shares were priced above $200 during pandemic lows, there has been significant appreciation over time.

Long-term Growth Trends

Analysis of Company Margins and Cash Flow

Overview of Gross and Net Margins

• The company maintains strong gross margins, indicating effective cost management in manufacturing. This stability suggests a solid pricing power where the company sets prices rather than being dictated by market negotiations.

• While net margins have slightly decreased, they remain stable around 30%. However, cash flow margins have notably declined, possibly due to increased capital expenditures (CAPEX) or rising inventory levels.

Cash Flow Analysis

• A thorough analysis is essential before investing; the speaker emphasizes diligence over hearsay regarding stock recommendations. Observing cash flow trends is crucial for understanding financial health.

• The decline in free cash flow raises questions about CAPEX and accounts receivable management. It's important to monitor these factors closely as they impact overall liquidity.

Dividend and Share Buyback Insights

• Despite declining cash flows, the company continues to pay dividends. However, share buybacks have significantly slowed down, reflecting a cautious approach to cash management amid reduced liquidity.

• The relationship between dividends and share repurchases indicates prudent financial governance; the firm aims to balance shareholder returns without jeopardizing its financial stability.

Long-term Financial Health

• If free cash flows continue to decrease, there may be challenges in sustaining dividend payments. Monitoring this trend is critical as it could lead to necessary adjustments in dividend policy.

• Current assessments show that the company has sufficient cash reserves to cover long-term debt obligations within two years if all available free cash flow were allocated towards debt repayment.

Dividend Growth Potential

• The current dividend yield stands at 0.84%, aligning with historical averages. Notably, there has been a significant increase in dividends over five years—over 23% annually—which raises questions about sustainability moving forward.

• Real-time analysis allows for immediate insights into financial performance; managing cash effectively will be vital for maintaining or increasing future dividends.

Performance Comparison and Management Alignment

• Over ten years, the company's performance surpasses that of the S&P 500 index. Shorter-term comparisons show parity with market benchmarks but highlight superior long-term growth strategies.

• A concerning observation is that ownership among employees is nearly nonexistent; this prompts scrutiny regarding whether management's goals align with long-term investor interests rather than short-term gains.

Analysis of Corporate Decision-Making and Valuation

Short-Term vs Long-Term Decision Making

• Discussion on how newly appointed executives often prioritize short-term gains, such as stock buybacks, to boost earnings per share for their own benefit.

• Emphasis on the importance of long-term vision in companies, particularly in technology sectors like artificial intelligence and electronics.

• The challenge investors face in predicting future growth due to management's uncertainty about upcoming performance.

Current Valuation Metrics

• Mention of a Price-to-Earnings Ratio (PER) around 38, indicating high valuation relative to historical norms which were between 20 and 30 before 2020.

• Analysis of revenue multiples showing over 10 times sales; while justified by margins and growth, it still appears elevated compared to other businesses with recurring revenues.

Market Dynamics and Future Projections

• Difficulty in assessing market share growth and total addressable market (TAM), complicating valuation efforts for certain companies.

• Acknowledgment that cash flow metrics have deteriorated, leading to inflated valuations despite underlying challenges.

Growth Estimates Challenges

• Management's guidance for next year's growth ranges from +6% to +23%, highlighting the unpredictability faced by external investors trying to forecast performance.

• Comparison with mature companies like Apple or Coca-Cola where consistent growth rates can be estimated based on market trends.

Unique Valuation Approaches

• Discussion on valuing unique companies like Tesla through specific metrics such as annual vehicle sales and average selling price rather than traditional methods.

• Ongoing development of a detailed valuation model for Tesla that reflects its distinct business characteristics.

Conclusion on ASML Valuation

• Tentative projection suggesting a potential $670 valuation based on assumed future growth rates; current trading at approximately $720 indicates it may be slightly overpriced.

Analysis of Investment Potential in a European Company

Growth Projections and Valuation

• The speaker discusses the company's potential for 15% growth, suggesting that current pricing may be attractive if this growth is realized. They mention a minimum expected return on investment of 10% per year.

• Caution is expressed regarding the sustainability of 15% annual growth over many years, indicating skepticism about maintaining such high growth rates.

• The speaker reflects on past performance to estimate future valuations, noting that current market prices seem reasonable based on historical data.

Market Understanding and Competitive Landscape

• Acknowledgment of the company as a strong player in its sector, with unique machines contributing to its competitive edge. However, there are concerns about valuation being slightly high.

• The speaker compares this company to other successful businesses like LVMH but remains cautious due to perceived overvaluation despite recognizing potential for continued interest from investors.

Challenges in Demand Estimation

• Discussion around cyclical revenue patterns and how economic downturns could impact consumer spending on technology products, which may affect business performance.

• The speaker expresses difficulty in understanding internal demand dynamics within the industry, highlighting a lack of competitive advantage for individual investors trying to gauge future growth.

Investment Philosophy and Strategy

• Emphasis on making investment decisions based on clear understanding; uncertainty leads to reluctance in investing. The speaker prefers investments where they can sleep soundly at night without worry.

• Reflection on past investment successes attributed to understanding companies well and holding onto quality positions rather than frequent trading.

Future Monitoring and Engagement

• While currently not investing due to valuation concerns, the speaker intends to monitor the company closely for any changes that might present new opportunities.

• Recognition of the challenge in finding high-quality companies at reasonable prices for investment portfolios like PEA (Plan d'Épargne en Actions), while expressing hope that viewers find value in their analysis.

Conclusion and Personal Insights