STMicroelectronics (NYSE:STM) Shares Down 3.5% - Should You Sell?

Key Points

• Shares fell 3.5% intraday to $55.95 on Thursday, with volume rising about 14% to 10.68 million shares versus the average of 9.35 million.
• Analysts hold a Moderate Buy consensus (10 Buys, 2 Holds, 1 Sell), but the consensus price target is $49.07 — significantly below the current share price, implying limited analyst upside.
• Fundamentals show thin profitability and a high valuation (Q1 EPS $0.13, net margin 1.19%, P/E ~350) despite a strong balance sheet (current ratio 3.31, debt/equity 0.12) and a market cap of about $50.3 billion.

STMicroelectronics N.V. (NYSE:STM - Get Free Report) shares traded down 3.5% on Thursday . The stock traded as low as $55.20 and last traded at $55.9450. 10,683,140 shares traded hands during mid-day trading, an increase of 14% from the average session volume of 9,348,265 shares. The stock had previously closed at $57.95.

Analysts Set New Price Targets

A number of brokerages have recently commented on STM. Mizuho set a $48.00 price objective on shares of STMicroelectronics and gave the company an "outperform" rating in a research report on Thursday, April 16th. Citigroup reiterated a "buy" rating on shares of STMicroelectronics in a research note on Sunday, April 26th. Morgan Stanley upgraded shares of STMicroelectronics from an "equal weight" rating to an "overweight" rating in a research note on Thursday, March 26th. Weiss Ratings upgraded shares of STMicroelectronics from a "sell (d+)" rating to a "hold (c-)" rating in a research note on Friday, April 24th. Finally, TD Cowen reiterated a "hold" rating on shares of STMicroelectronics in a research note on Friday, April 24th. Ten investment analysts have rated the stock with a Buy rating, two have given a Hold rating and one has issued a Sell rating to the company's stock. Based on data from MarketBeat.com, the company currently has a consensus rating of "Moderate Buy" and a consensus price target of $49.07.

STMicroelectronics Price Performance

The company has a quick ratio of 2.34, a current ratio of 3.31 and a debt-to-equity ratio of 0.12. The stock has a market cap of $50.25 billion, a price-to-earnings ratio of 349.68 and a beta of 1.89. The company's 50-day moving average is $38.29 and its 200-day moving average is $30.98.

STMicroelectronics (NYSE:STM - Get Free Report) last posted its quarterly earnings results on Saturday, March 28th. The semiconductor producer reported $0.13 earnings per share (EPS) for the quarter. STMicroelectronics had a net margin of 1.19% and a return on equity of 3.01%. The firm had revenue of $3.10 billion during the quarter. Equities research analysts expect that STMicroelectronics N.V. will post 1.09 earnings per share for the current fiscal year.

Institutional Inflows and Outflows

Several hedge funds have recently added to or reduced their stakes in STM. Amundi acquired a new position in STMicroelectronics in the first quarter worth about $947,000. AQR Capital Management LLC raised its position in STMicroelectronics by 182.8% in the first quarter. AQR Capital Management LLC now owns 32,094 shares of the semiconductor producer's stock worth $705,000 after purchasing an additional 20,745 shares in the last quarter. Legal & General Group Plc acquired a new position in STMicroelectronics in the second quarter worth about $119,000. M&T Bank Corp acquired a new position in STMicroelectronics in the second quarter worth about $303,000. Finally, EverSource Wealth Advisors LLC raised its position in STMicroelectronics by 79.1% in the second quarter. EverSource Wealth Advisors LLC now owns 4,883 shares of the semiconductor producer's stock worth $148,000 after purchasing an additional 2,156 shares in the last quarter. Institutional investors and hedge funds own 5.05% of the company's stock.

About STMicroelectronics

STMicroelectronics is a global semiconductor company headquartered in Geneva, Switzerland, formed through the 1987 merger of SGS Microelettronica and Thomson Semiconducteurs. The company designs, develops and manufactures a broad range of semiconductor products and solutions that serve multiple end markets worldwide. ST's offerings span from basic components to integrated systems, emphasizing energy-efficient and high-performance devices for modern electronics.

Product categories include microcontrollers (notably the widely used STM32 family), analog and mixed-signal ICs, power MOSFETs and power-management devices, MEMS and sensors, image sensors, and discrete semiconductors.

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