Analysts Are Updating Their STMicroelectronics N.V. (EPA:STMPA) Estimates After Its Full-Year Results

STMicroelectronics N.V. (EPA:STMPA) last week reported its latest yearly results, which makes it a good time for investors to dive in and see if the business is performing in line with expectations. The result was positive overall - although revenues of US$17b were in line with what the analysts predicted, STMicroelectronics surprised by delivering a statutory profit of US$4.46 per share, modestly greater than expected. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.

Check out our latest analysis for STMicroelectronics

Taking into account the latest results, the current consensus, from the 17 analysts covering STMicroelectronics, is for revenues of US$16.7b in 2024. This implies a small 3.7% reduction in STMicroelectronics' revenue over the past 12 months. Statutory earnings per share are forecast to crater 29% to US$3.31 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$17.4b and earnings per share (EPS) of US$3.91 in 2024. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a substantial drop in earnings per share numbers.

Despite the cuts to forecast earnings, there was no real change to the €53.99 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values STMicroelectronics at €75.06 per share, while the most bearish prices it at €34.44. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 3.7% by the end of 2024. This indicates a significant reduction from annual growth of 15% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 7.0% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - STMicroelectronics is expected to lag the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. The consensus price target held steady at €53.99, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple STMicroelectronics analysts - going out to 2026, and you can see them free on our platform here.

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.