(Bloomberg) -- ASM International NV shares hit a record high as analysts at Morgan Stanley and Bank of America turned more bullish on the Dutch company’s role in the artificial intelligence boom.

The chipmaking tools manufacturer is set to be a main beneficiary as the semiconductor industry adopts the next-generation chip architecture known as gate all-around, Morgan Stanley’s Nigel van Putten said, predicting ASMI’s growth to outpace the broader chip equipment market in years ahead.

“As AI becomes the main driver of the semiconductor (equipment) market, we see ASMI as a core holding,” the analyst wrote in a note, raising the recommendation to overweight from equal-weight.

The stock jumped as much as 6.7% in Amsterdam on Thursday.

ASMI holds a more than 50% market share in atomic layer deposition, an advanced equipment that deposits ultra-thin films of materials on semiconductor wafers. Patents that the company own are some of the most important in the chipmaking space, van Putten said, citing an analysis by LexisNexis.

Morgan Stanley’s bullish view was shared by Bank of America analysts, who raised the stock’s target price to €860, a Street-high. The target implies around 18% upside to the stock’s current level, contrasting with the consensus view that the shares will fall in the next 12 months.

ASMI’s thin-film deposition tools “are critical in the manufacturing of leading-edge logic and memory chips used in AI infrastructure,” said Bank of America’s Didier Scemama, who also holds Wall Street’s most optimistic estimate on ASML Holding NV, another Dutch chip-tool maker.

ASMI shares have rallied more than 50% this year. It was one of the best-performing stocks among Euro Stoxx 600 members in 2023, rising 99%.

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