Palantir (PLTR) vs. ASML (ASML): Which Looks Better on Fundamentals Right Now?
- Sanzhi Kobzhan
- Nov 4, 2025
- 4 min read
Updated: Nov 27, 2025
Below is a crisp, investor-focused comparison of Palantir Technologies (PLTR) and ASML Holding (ASML) based on the Stocks2Buy Fundamental Analyzer app. I’ll weigh valuation, profitability/efficiency, growth momentum, and business-model risk to reach a clear, defensible conclusion on which company looks stronger on fundamentals today.
Executive take
Key Metrics
Fundamental quality (classic lens: ROE/ROIC/FCF yield, valuation sanity): ASML screens stronger. Returns on capital (ROE/ROIC) are materially higher, free-cash-flow yield is superior, and the multiple is far more grounded than PLTR’s.
ASML Key Metrics
PLTR Key Metrics
Financial Ratios
Growth momentum and margin structure (software vs. equipment): Palantir posts faster recent growth and ultra-high gross margins, reflecting its software model and the ramp of AIP.
PLTR Key Financial Ratios
ASML Key Financial Ratios
On a fundamentals-first basis, ASML looks better today. Palantir can still work for growth-oriented investors with a high risk tolerance.
Business models (and why they’re not true “competitors”)
Palantir builds enterprise software platforms—Gotham, Foundry, Apollo, and AIP—used by governments and commercial customers to integrate data, detect patterns, and operationalize AI-driven decisions. This is a recurring-revenue, high-gross-margin software business with growing commercial adoption.
ASML designs and manufactures the world’s most advanced lithography systems (EUV and DUV) used by chipmakers (TSMC, Samsung, Intel, etc.). It enjoys a dominant competitive position and a razor/razor-blade dynamic via installed-base services and upgrades. This is a capital-equipment business with cyclical orders but exceptional long-term economics driven by node shrinks and AI semiconductor demand.
Comparing PLTR to ASML is cross-sector (AI software vs. chip equipment). It’s useful, but keep in mind that valuation ranges and risk cycles differ—software’s asset-light compounding vs. equipment’s order cyclicality and very high barriers to entry.
Comparing Valuation, Cash Yield, Profitability & Capital Efficiency
Valuation & cash yield
Metric | PLTR | ASML | Takeaway |
P/E | 688.1x | 38.1x | PLTR trades at a substantial premium. |
EV/FCF | 274.3x | 38.8x | Cash yield markedly better at ASML. |
FCF Yield | 0.40% | 2.60% | ASML > PLTR on owner’s yield. |
DCF (tool est.) | Consensus FV $57 vs Price ~$205 | Consensus FV $896 vs Price ~$1,070 | Both screen over fair value; PLTR’s gap is much wider. |
If you prioritize valuation discipline and cash-flow support, ASML is the cleaner setup.
Profitability & capital efficiency
Metric | PLTR | ASML | Takeaway |
Gross Margin | 80.00% | 52.50% | Software advantage to PLTR. |
ROA | 10.40% | 21.00% | ASML operates more efficiently on assets. |
ROE | 14.60% | 54.00% | ASML delivers far higher equity returns. |
ROIC | 8.80% | 34.90% | ASML’s economic moat shows up here. |
ASML dominates the return metrics, despite lower gross margin. That’s what high-quality industrial franchises look like.
What the numbers say (and how to read them)
Valuation discipline favors ASML
P/E 38x for ASML vs 688x for PLTR, and EV/FCF 38.8x vs 274x. Even generous growth assumptions need flawless execution to sustain PLTR’s multiples. ASML’s premium is meaningful but anchored by dominant industry structure, tangible cash generation, and a long runway tied to AI-driven node shrinks.
Returns on capital favor ASML
ROE 54% and ROIC ~35% are elite metrics that argue for durable competitive advantage and strong reinvestment economics. PLTR’s ROE/ROIC are positive and improving, but materially lower—unsurprising for a company earlier in its operating-leverage journey. (Software’s 80% gross margin shows up first; returns on capital follow as scale and GAAP profitability mature.)
Growth and margin structure favor Palantir—in the near term
PLTR’s revenue, operating income, EPS, OCF, and FCF all compounding rapidly. That aligns with Palantir’s reported 2024–2025 acceleration, especially in U.S. commercial with AIP. ASML’s revenue growth was modest in 2024, but services/installed base and mix helped margins, and the secular AI wafer-demand driver remains intact beyond cyclical noise.
Risks to watch
Palantir
Valuation air-pocket risk: Multiple compression could overwhelm beats, especially if AIP monetization slows or competition intensifies across enterprise AI stacks. (The company’s own 10-K outlines competitive and customer-concentration risks typical of defense/commercial software.)
ASML
Geopolitics & capex cycles: Export controls and China mix inject volatility; High-NA adoption timing matters for 2026–2027 order books. Even with a moat, equipment names feel capex pauses more acutely than software.
Verdict: Which is “better” on fundamentals? Palantir (PLTR) vs. ASML (ASML)
If we judge based on capital efficiency + valuation support + cash yield, ASML wins. It posts superior ROE/ROIC, a rational EV/FCF, and a DCF gap far smaller than Palantir’s. The business also benefits from structural, long-cycle demand for advanced lithography, with services smoothing cyclicality over time.
If you prioritize high growth and software economics, Palantir is compelling—80% gross margins, strong 2024–2025 momentum, and a steepening commercial curve with AIP. Just recognize that a lot of that promise is already priced in, so execution has to stay near-perfect.
From a fundamentals-first lens today, ASML looks better. PLTR can still be the right pick for investors explicitly seeking higher-beta AI software exposure and willing to tolerate valuation risk.
How I built this analysis (and how you can, too)
This analysis was generated using the Stocks2Buy Fundamental Analyzer. You can run the same workflow on the web or using the Stocks 2 Buy iOS app. It offers equivalent functionality on iPhone.
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