Jefferies on Thursday raised its price target on ASML Holding to €1,560 from €1,260 and increased its price target on STMicroelectronics to €82 from €74, citing model upgrades and a re-rating across European semiconductor peers.
The brokerage noted a strong second quarter for the region's chip stocks, with European semiconductor equities up 69% in Q2 2026 and the SOX index advancing 88% through the same period.
Analog names led the gains within the group, according to Jefferies. The firm pointed to Soitec rising 120%, STMicroelectronics up 115% and Infineon Technologies climbing 102% as examples of outperformance versus semiconductor-capital-equipment names.
Jefferies highlighted material multiple expansion during the quarter. The firm said STMicroelectronics' price-to-earnings multiple re-rated by 44%, Infineon's by 65% and ASML's by 31%. The note added that ASML, ASM International and VAT are trading at their peak multiples, while STMicroelectronics and Infineon are trading well above their previous peaks.
On ASML, Jefferies modelled second-quarter revenue of €8.79 billion and a gross margin of 52%, figures it described as being in line with consensus and management guidance. The brokerage said it expects ASML's full-year revenue guidance range to be lifted from €36 billion-€40 billion to €38 billion-€42 billion.
Investor attention, the note said, will focus on management commentary around low-NA EUV system shipments for 2027. Jefferies stated that it believes ASML is preparing for shipments of around 90 systems for 2027. The new ASML valuation target uses an FY27 price-to-earnings multiple of 36 times and an enterprise-value-to-EBITDA multiple of 28 times.
For STMicroelectronics, Jefferies projected second-quarter revenue of $3.47 billion with an adjusted gross margin of 35.3%, again in line with consensus. The brokerage said it expects the company to guide first-half growth to occur in the second half of the year at roughly 20% half-on-half, versus prior guidance of about 15% - a change Jefferies attributed mainly to stronger-than-expected data centre revenues.
Jefferies' full-year 2026 forecast for STMicroelectronics calls for revenue of $14.47 billion, a 23% increase year-on-year, with a 36.1% gross margin. The new STMicroelectronics target is built on 31 times its 2027 earnings-per-share forecast and 4.8 times enterprise-value-to-sales.
Jefferies maintained "buy" ratings on both ASML and STMicroelectronics. The brokerage said it anticipates further earnings upgrades over the next six to seven quarters as the analog upcycle gathers momentum, while cautioning that further re-rating may be limited in H2-26 given elevated valuation multiples across the sector.
In addition to the ASML and STMicroelectronics moves, Jefferies raised price targets elsewhere in the group: ASM International to €780 from €670, VAT to 560 Swiss francs from 465 Swiss francs, and Melexis to €94 from €82.
Context and investor focus
Jefferies' changes reflect both upgrades to near-term financial estimates and a shift in investor sentiment that has pushed multiples higher across analog and equipment segments. The brokerage pointed to data-centre demand as a factor improving STMicroelectronics' near-term trajectory and identified management commentary at ASML about 2027 shipments as a key upcoming datapoint.
Valuation framing
The new targets for ASML and STMicroelectronics are explicitly tied to valuation multiples on forward-year metrics: ASML on FY27 P/E of 36 times and EV/EBITDA of 28 times; STMicroelectronics on 31 times 2027 EPS and 4.8 times EV/Sales. Jefferies signalled expectations for continued upward revisions to earnings, but also flagged the risk that multiple expansion may slow in the latter half of 2026.