Earnings Update: STMicroelectronics N.V. (EPA:STMPA) Just Reported And Analysts Are Trimming Their Forecasts

It's been a mediocre week for STMicroelectronics N.V. (EPA:STMPA) shareholders, with the stock dropping 10% to €21.83 in the week since its latest yearly results. It was a credible result overall, with revenues of US$13b and statutory earnings per share of US$1.66 both in line with analyst estimates, showing that STMicroelectronics is executing in line with expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

See 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$11.9b in 2025. This implies a definite 10% reduction in STMicroelectronics' revenue over the past 12 months. Statutory earnings per share are forecast to tumble 33% to US$1.17 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$12.8b and earnings per share (EPS) of US$1.39 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.

The consensus price target fell 6.9% to €26.98, with the weaker earnings outlook clearly leading valuation estimates. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values STMicroelectronics at €39.72 per share, while the most bearish prices it at €16.09. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 10% by the end of 2025. This indicates a significant reduction from annual growth of 11% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 6.5% annually for the foreseeable future. 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 fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of STMicroelectronics' future valuation.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. At Simply Wall St, we have a full range of analyst estimates for STMicroelectronics going out to 2027, and you can see them free on our platform here..

You still need to take note of risks, for example - STMicroelectronics has 1 warning sign we think you should be aware of.

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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.