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Major Bank: AI Potential May Be "Overhyped"

» Updated: 05 October 2024, 01:53

» Published: 04 September 2024

Major Bank: AI Potential May Be "Overhyped"
Photo: Peter Dejong/AP/TT

The Swiss major bank UBS Group's analysts have lowered their recommendation for shares in Dutch ASML Holding from "buy" to "hold".

UBS experts have had a buy recommendation on the share for two years. But now they are warning that the growth potential in artificial intelligence (AI) is on the verge of becoming "overhyped".

ASML is a major manufacturer of advanced equipment for semiconductor factories around the world.

The UBS downgrade comes after AI boom's big winner, American Nvidia, took a big hit on Wall Street on Tuesday and appears to continue downward. Nvidia is dragging many AI sector shares with it.

Since UBS gave ASML shares a "buy" stamp in August 2022, they have risen by over 60 percent. But in Wednesday's trading, the share fell by 7 percent.

UBS still describes ASML as one of the best investment opportunities in Europe's technology sector. And more than three-quarters of the analyst corps following the sector have a "buy" stamp on the share.

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By TTThis article has been altered and translated by Sweden Herald

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