Update shared on04 Sep 2025
Analysts remain divided on STMicroelectronics, with bulls citing improving 2025 demand, gross margin expansion, and sector tailwinds, while bears point to broad EMS sector weakness and muted near-term revenue expectations, resulting in the consensus price target remaining unchanged at €25.84.
Analyst Commentary
- Bullish analysts cite improved demand prospects in the second half of 2025, a bottom in silicon carbide revenue, gross margin expansion, and higher STM content in new products as drivers for price target increases and upgrades.
- Multiple firms anticipate inventory normalization in key end-markets, with industrial and automotive revenues expected to see sequential improvement, supporting estimates of easier year-over-year comparisons beginning in early 2026.
- Bullish analysts are encouraged by sector-wide semiconductor growth forecasts and expect STM's near-term results to be at the higher end of guidance, prompting opportunistic upgrades.
- Bearish analysts and those lowering price targets highlight wider weakness across the Electronic Manufacturing Services sector and recent downgrades to sector peers, reflecting concerns over near-term demand and mixed Q2 sector results.
- Some price target reductions from major banks like JPMorgan are attributed to tempered expectations on revenue growth and sector-wide uncertainties, though core long-term views remain neutral or constructive.
What's in the News
- Completed $257 million share buyback program, repurchasing 1.14% of shares.
- Issued Q3 2025 earnings guidance: net revenues $3.17 billion, down 2.5% YoY, up 14.6% QoQ.
- Signed new license agreement with Metalenz, expanding capability in advanced metasurface optics using 300mm wafer technology.
- Introduced 5th generation Human Presence Detection technology for PCs, combining proprietary Time-of-Flight sensors with AI for enhanced privacy, power reduction, and user experience.
Valuation Changes
Summary of Valuation Changes for STMicroelectronics
- The Consensus Analyst Price Target remained effectively unchanged, at €25.84.
- The Future P/E for STMicroelectronics has significantly fallen from 15.40x to 13.33x.
- The Discount Rate for STMicroelectronics remained effectively unchanged, at 8.78%.
Disclaimer
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