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Compare ASML KLAC LRCX
Date: 2026-07-15 · Sector: Semiconductors (Semi Equipment & Materials)
Format: Full /analyze on each + head-to-head synthesis answering: which has more pricing power → future revenue?
Data notes: Yahoo MCP not connected — sourced from roic.ai (FY2025 statements/ratios), Alpha Vantage (TTM/live), WebSearch (qualitative/Q2-26). ASML statements are in EUR (ADR price/EPS in USD; EUR/USD ≈1.08). KLAC and LRCX both did ~10:1 stock splits — share counts ~1.3B, per-share figures are post-split. All three have had 2–4× runs off their 52-wk lows on the AI fab-equipment supercycle.
Snapshot (current)
| ASML | KLAC | LRCX | |
|---|---|---|---|
| Role | EUV/DUV lithography | Process control (inspection/metrology) | Etch & deposition |
| Price | ~$1,797 (ADR) | ~$230 | ~$346 |
| Market cap | ~$693B | ~$301B | ~$433B |
| 52-wk range | $680–2,000 | $83–307 | $90–438 |
| Rev TTM | €33.7B (~$36B) | $13.1B | $21.7B |
| TTM EPS | $29.48 | $3.66 | $5.54 |
| Trailing P/E | 61x | 63x | 62x |
| Forward P/E | 49x | 44x | 42x |
| FCF (FY25) | €11.0B | $4.1B | $6.2B |
| FCF yield | ~1.7% | ~1.4% | ~1.4% |
| Div yield | 0.49% | 0.34% | 0.31% |
| Analyst target | $1,874 (~+4%) | $231 (~flat) | $365 (~+5%) |
| Beta | 1.39 | 1.41 | 1.81 |
The shared headline: three exceptional, high-return franchises — all trading at ~62x trailing / ~42–49x forward, all near analyst price targets (little consensus upside left), all near all-time highs after enormous AI-capex rallies. This is the framework's "great company, expensive" quadrant across the board. The businesses are not the question; the entry price is.
1. Fundamentals & Moat — by name
ASML — the EUV monopoly
| Metric (FY25) | Value |
|---|---|
| Gross margin | 52.8% (54% in Q2-26) |
| Operating margin | 34.6% |
| Net margin | 29.4% |
| ROIC / ROE | 38.8% / 60% |
| FCF / share | €28.38 |
| Backlog | €38.8B (> a full year of sales) |
Moat: the widest in tech. ASML is the sole maker of EUV and High-NA EUV lithography — there is no #2. Sub-7nm logic and advanced DRAM literally cannot be made without its machines. Q2-26 (reported today, 7/15): €9.3B sales, €2.9B NI, FY guide raised to €43–45B (from €36–40B), and Intel shipped the world's first high-volume High-NA logic product. High-NA units run ~$380M each. Adversarial stress-test: a well-funded rival would need decades and tens of billions to replicate the optics (Zeiss), light source, and systems integration — effectively impossible. Evergreen: yes, and structurally strengthening. The one real constraint is geopolitical, not competitive — see risks.
KLAC — the process-control toll booth
| Metric (FY25) | Value |
|---|---|
| Gross margin | 60.9% (highest) |
| Operating margin | 41.2% |
| Net margin | 33.4% (highest) |
| ROIC / ROE | 41.3% / 95% |
| Installed-base services | 52 consecutive quarters of growth |
Moat: near-monopoly with the best economics. ~60% of process control, no competitor above 8% (7× the nearest), and share still expanding (+360bps since 2021). Every shrink and every advanced-packaging step raises inspection/metrology intensity, so KLA's TAM grows with chip complexity — the AI-packaging wave is a direct tailwind (process-control advanced-packaging revenue $635M→~$1B in 2026, now #1 in the segment). The 52-quarter services annuity is a recurring, price-inelastic floor. The 61% gross margin is the tell: the market lets KLA keep more of every dollar than anyone else — realized pricing power.
LRCX — the etch/deposition leader (in a real oligopoly)
| Metric (FY25) | Value |
|---|---|
| Gross margin | 48.7% (lowest of three) |
| Operating margin | 32.0% |
| Net margin | 29.1% |
| ROIC / ROE | 37.1% / 67% |
| Q3-26 growth | Rev +24% YoY, EPS +41% (fastest now) |
Moat: strong leadership, but genuinely contested. Lam leads etch and deposition (ALD/PECVD), critical for 3D NAND, DRAM, and gate-all-around logic — but it competes head-to-head with Applied Materials and Tokyo Electron. That competition shows up in the lowest gross margin of the three (49%) = the least pricing power. Most cyclical (NAND-levered; NAND conversion spend ~$40B is being pulled forward pre-2027) and highest beta (1.81). Currently growing fastest because the NAND upcycle is volume, not durable price.
2. Valuation — all rich, ranked by risk
Graham/DYT/DDM are N/A here (asset-light, sub-1% yields, tiny book values → Graham lowballs meaninglessly). The operative lens is Bogle expected return, and the operative risk is multiple compression from ~45x forward.
| Forward P/E | Upside to target | Verdict on entry | |
|---|---|---|---|
| ASML | 49x | +4% | Most expensive; priciest monopoly premium |
| KLAC | 44x | ~0% | Best economics, but at target |
| LRCX | 42x | +5% | Cheapest headline, but most cyclical + highest beta |
A 42–49x forward multiple prices in years of uninterrupted growth. The businesses can grow into it (ASML's guide implies +35% revenue), but any wobble in the AI-capex narrative de-rates all three hard — and they move together (all beta ~1.4–1.8, all "sold out into 2027" on the same demand story). Fair-value entry zones (business-quality-adjusted, waiting for a pullback): - ASML: accumulate ~$1,300–1,500 (near 200-day $1,337); exceptional but no margin of safety at $1,797. - KLAC: accumulate ~$180–200 (200-day $156); the one I'd most want to own, at a better price. - LRCX: accumulate ~$250–290; demand a bigger discount for the cyclicality/beta.
3. ⭐ The core question: pricing power → future revenue
Ranking of raw pricing power: ASML > KLAC > LRCX. Ranking of pricing-power that converts most durably into future revenue: it's a genuinely close call between ASML and KLA, and the answer splits on what you weight.
🥇 ASML — the most pricing power, and the most visible future revenue. It is a literal monopoly; customers have no alternative, so ASML sets price. And uniquely, its pricing power is already booked as future revenue you can see: a €38.8B backlog larger than a full year of sales, plus a guide just raised 20%+, plus High-NA (~$380M/unit) entering volume. That is pricing power → future revenue made concrete. The catch: its addressable revenue is capped by geopolitics, not competition — China falls from 33% (2025) to ~20% (2026) under tightening US/Dutch export rules (MATCH Act threatens even DUV), and revenue is lumpy and customer-concentrated (TSMC/Samsung/Intel). Its 52–54% gross margin (lowest-ish) also shows it doesn't extract maximum price — it prices to keep customers healthy.
🥈 KLA — the best pricing power quality, and the cleanest conversion into resilient, high-margin revenue. KLA doesn't have ASML's absolute monopoly, but it has the highest gross (61%) and net (33%) margins of the three — the clearest proof of realized pricing power (the market lets it keep the most per dollar). Crucially, its pricing power compounds with complexity: every node shrink and every AI advanced-packaging step raises process-control intensity, so KLA's revenue grows structurally with the physics of chipmaking, not just the capex cycle. Add the 52-quarter services annuity (recurring, sticky, price-inelastic) and less export-control exposure than the EUV chokepoint, and KLA has the most durable and least-capped pricing-power-to-revenue engine.
🥉 LRCX — real leadership, least pricing power. Lowest margins confirm it competes on more than price. Its future revenue is more cyclical volume (NAND) than durable pricing. Fastest grower right now, but that's the upcycle, not moat.
Bottom line for the user: ASML has the most pricing power and the most contractually-visible future revenue (€38.8B backlog) — but it's geopolitically capped and the lumpiest. KLA has the highest-quality pricing power (best margins, rising intensity, 52-quarter service annuity, least export risk) — the cleanest, most durable pricing-power→revenue conversion. If you want raw power + visible order book → ASML. If you want the pricing power most likely to compound into resilient revenue through a cycle → KLA. LRCX is the trailing choice on this specific question.
4. Verdicts & conviction
| Business quality | Entry now (~ATH) | Conviction | Action | |
|---|---|---|---|---|
| ASML | 9.5/10 | Poor (49x fwd, +4% to target) | 8.0 | 🟡 WATCH — accumulate $1,300–1,500 |
| KLAC | 9.0/10 | Poor (at target) | 8.0 | 🟡 WATCH — accumulate $180–200; preferred name |
| LRCX | 8.0/10 | Poor (cyclical, beta 1.8) | 7.0 | 🟡 WATCH — accumulate $250–290 |
Shared key risks: (1) Multiple compression — 42–49x forward leaves no room for error; (2) AI-capex cyclicality — all three are "sold out into 2027" on the same demand story and will fall together if it cracks; (3) China/export controls — most acute for ASML, real for all; (4) customer concentration — a handful of leading-edge fabs (TSMC/Samsung/Intel) drive the leading edge.
A portfolio-specific passage was removed from the public build.
Recommendation: Add all three to Watchlist as WATCH with the entry zones above, KLAC flagged as the highest-quality-for-price. None is a buy at today's near-ATH levels.