Investing.com -- Mizuho downgraded ASML (AS:ASML) to Neutral from Buy in a note Wednesday, citing "downside risk to 2026 business outlook." 

The firm also lowered its price objective to "EUR650 (25x 2026-27E P/E) from EUR810 (26x 2026E P/E).”

Mizuho stated, "We now forecast ASML’s sales to drop 3% YoY and EPS to stay flattish YoY in 2026." 

The firm pointed to "higher customer concentration to TSMC" as a factor that "should lead to higher business volatility for ASML going forward."

According to Mizuho, "We see some EUV shipments pull-in for TSMC in 2025 based on our estimated EUV installation, which should lead to EUV shipments decline in 2026." 

The firm also said that it expects limited upside potential for Samsung (KS:005930) and Intel (NASDAQ:INTC) in 2026.

Mizuho projected, "We forecast total EUV shipments for ASML to decrease to 49 units in 2026 from 53 units in 2025." 

The firm added, "We expect TSMC’s N2 monthly capacity to increase to 30k-40k by 2025 and 70k-80k by 2026 from 10k by 2024," but it expects "TSMC’s EUV shipments might decline to 15 units in 2026 from 18 units in 2025, based on our estimates."

Looking ahead, Mizuho stated that it sees ASML’s sales and GPM reaching the high end of guidance or beating slightly in 1Q25, given demand strength from China.

The firm now forecasts ASML’s China sales to decline 35% YoY in 2025, better than its previous forecast of a 45% drop.

Mizuho also highlighted valuation concerns, saying, "We base our price objective on 25x 2026-27E P/E, roughly in line with the historical average P/E of 26x." Risks include "EUV demand, WFE cycle, and cost."