Research
Research Alert: CFRA Raises Recommendation On Adss Of Stmicroelectronics To Buy From Hold
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We raise our rating to Buy from Hold with a higher target price of USD60 (from USD30), implying a 2026 P/E of 45x and a 2027 P/E of 28x, as we believe STM is well positioned as a diversified analog and mixed-signal semiconductor leader with strategic exposure to electrification, energy efficiency, and digitalization across automotive, industrial, and IoT end markets, particularly through its leadership in silicon carbide power devices, automotive MCUs, and MEMS sensors. For Q2 2026, management guided net revenues to ~USD3.45B (well ahead of consensus of USD3.19B) and gross margin of around 34.8%. While our long-term view remains constructive given STM's early vertical integration in SiC and design wins with key OEMs, we remain cautious in the near term due to ongoing automotive and industrial semiconductor cycle weakness, slower-than-expected OEM inventory digestion, and suboptimal fab utilization weighing on margins. We raised our 2026 EPS estimate to USD1.30 from USD1.10 and 2027's to USD2.10 from USD1.90.
$STM