UBS Equity Preference List European Information Technology 2026 08 21

21 August 2026, 11:21 UTC Chief Investment Office GWM Investment Research

European Information Technology Equity preferences

The European Information Technology Equity Preference list (EPL) is a list of our highest conviction European Information Technology stocks. Achille Monnet UBS Switzerland AG Eurozone sector preference: Attractive Please see important disclaimers and Sector view: This high-quality sector benefits from AI-related demand for disclosures at the end of this semiconductor equipment, while software revenues are boosted by the document. transition to the cloud. The sector should continue to benefit from accelerating EPS growth beyond FY26 into 2027. Consensus estimates see EPS growth accelerating from 14% in 2026 to 24% in 2027. On valuation, the sector is trading on a forward P/E of 28.2x, versus a 15-year average of 21x. While elevated, we don’t see this as excessive given the concentrated nature of the index, visibility on growth drivers for the largest incumbents, accelerating growth, and the attractive structural trends. We therefore retain our Attractive rating on the EU information technology sector.

Our Top Picks: ASML, ASM International, SAP

Latest Changes: We have updated the “Sector view” text.

Benchmark: MSCI Europe Information Techn.

Most Preferred Company Changes* Currency Weight

Adyen EUR 2.5% Amadeus EUR 2.0% ASM International EUR 5.0% ASML EUR 57.0% BE Semiconductor Industries EUR 2.0% Capgemini EUR 1.5% Computacenter plc GBP 4.0% Infineon Technologies AG EUR 3.5% Prosus NV EUR 1.5% SAP EUR 17.0% STMicroelectronics EUR 4.0%

Source: UBS, Consider potential trading restrictions, all figures are rounded *Changes since the last publication

Positioning and key trends Our IT portfolio covers semiconductor wafer equipment vendors, automotive and industrial semiconductors, IT services and software. Throughout the portfolio, the selection is underpinned by our conviction on the sustainability of the competitive advantages as well as valuation. We aim to buy when the margin of safety is compelling to reduce the probability of permanent portfolio losses.

Chief Investment Office GWM, 21 August 2026 Page 1 of 15

European Information Technology

Within the semiconductor subsector, we are positive on leading-edge wafer equipment incumbents ASML and ASMI. ASML is the only provider of transistor shrink in the world and is, thus, the only firm driving traditional Moore’s law (the concept that transistor density on integrated circuits would double about every 12 months). We believe the stock is particularly attractive today, given the strong capacity upcycle we expect in leading-edge logic and memory spending. We think the momentum in semiconductor equipment stocks continues to tilt to the upside for most firms. Elsewhere in leading-edge semiconductors, we are positive on ASM International’s positioning to capture the gate-all-around transistors architecture shift from FinFet. There is a significant inflection in both atomic layer deposition (ALD) and epitaxy from the GAA transition, where ASM International has leading product portfolios, strong entrenchment advantages, and is well poised to keep gaining share. Within the automotive and industrial semiconductor markets, while we do not anticipate a strong recovery into 2026 yet, we believe consensus expectations have adjusted appropriately and management guidance has bottomed or is near bottoming. Moreover, we see certain green shoots, particularly within industrial end markets as several incumbents are expecting a shallow recovery through 2026.

Within software & IT services, we prefer the more defensive, high-quality names as we see attractive valuations relative to structural trends. We see generative AI as an opportunity for IT services. Generative AI is not an off-the-shelf product and, as such, it should drive IT services companies in our portfolio. Software stocks have de-rated significantly recently as participants discount growing concerns over the terminal value and unit economics of software vendors in an AI environment. We believe the indiscriminate selling creates opportunities for certain idiosyncratic stocks and would focus on the more defensive stocks with…