STMicroelectronics (STM) Stock Sinks As Market Gains: What You Should Know
STMicroelectronics (STM) closed at $43.40 in the latest trading session, marking a -0.82% move from the prior day. This move lagged the S&P 500's daily gain of 0.07%. At the same time, the Dow added 0.02%, and the tech-heavy Nasdaq gained 0.01%.
Heading into today, shares of the chip company had lost 5.1% over the past month, lagging the Computer and Technology sector's gain of 1.5% and the S&P 500's gain of 0.38% in that time.
STMicroelectronics will be looking to display strength as it nears its next earnings release. On that day, STMicroelectronics is projected to report earnings of $1.07 per share, which would represent a year-over-year decline of 7.76%. Meanwhile, our latest consensus estimate is calling for revenue of $4.33 billion, up 0.12% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.29 per share and revenue of $17.33 billion. These totals would mark changes of +2.39% and +7.44%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for STMicroelectronics. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. STMicroelectronics is holding a Zacks Rank of #3 (Hold) right now.
Valuation is also important, so investors should note that STMicroelectronics has a Forward P/E ratio of 10.21 right now. This valuation marks a discount compared to its industry's average Forward P/E of 18.64.
Investors should also note that STM has a PEG ratio of 2.04 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Semiconductor - General was holding an average PEG ratio of 2.71 at yesterday's closing price.
The Semiconductor - General industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 82, putting it in the top 33% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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STMicroelectronics N.V. (STM) : Free Stock Analysis Report
