Now trading at a price of $50.21, STMicroelectronics has moved -1.1% so far today.
STMicroelectronics shares moved 36.8% over the last 52 weeks, with a high of $53.53 and a low of $28.35. During this time, the stock outperformed the S&P 500 index by 43.0%. As of January 2022, the company's 50-day average price is $49.0. STMicroelectronics N.V., together with its subsidiaries, designs, develops, manufactures, and sells semiconductor products in Europe, the Middle East, Africa, the Americas, and the Asia Pacific. The large-cap Technology company has 51,370 full time employees and is based in Geneva, Switzerland. STMicroelectronics has returned a 0.5% dividend yield over the last 12 months.
Exceptional EPS Growth with Low Leverage Levels:
| 2019-12-31 | 2020-12-31 | 2021-12-31 | 2022-12-31 | |
|---|---|---|---|---|
| Revenue (MM) | $9,556 | $10,219 | $12,761 | $16,128 |
| Revenue Growth | n/a | 6.94% | 24.88% | 26.39% |
| Gross Margins | 38.7% | 33.3% | 39.6% | 45.5% |
| Gross Margins Growth | n/a | -13.95% | 18.92% | 14.9% |
| Operating Margins | 11.6% | 12.1% | 19.6% | 28.3% |
| Operating Margins Growth | n/a | 4.31% | 61.98% | 44.39% |
| Net Margins | 10.8% | 6.79% | 13.41% | 26.8% |
| Net Margins Growth | n/a | -37.13% | 97.5% | 99.85% |
| Earnings Per Share | $1.14 | $1.2 | $2.16 | $4.19 |
| EPS Growth | n/a | 5.26% | 80.0% | 93.98% |
| Diluted Shares (MM) | 904 | 920 | 925 | 902 |
| Free Cash Flow (MM) | $646 | $804 | $1,188 | $1,601 |
| FCF Growth | n/a | 24.46% | 47.76% | 34.76% |
| Capital Expenditures (MM) | -$1,222 | -$1,654 | -$2,274 | -$3,978 |
| Net Debt / EBITDA | -0.47 | -0.16 | -0.18 | -0.11 |
STMicroelectronics Is Currently Under Priced:
Compared to the Technology sector's average of 27.16, STMicroelectronics has a trailing twelve month P/E ratio of 12.0 and, according to its EPS guidance of 4.39, an expected P/E ratio of 11.4. STMicroelectronics's PEG ratio is 0.29 based on its 40.1% compound average growth rate of historical and projected earnings per share. However, we believe that it is more prudent to calculate the PEG ratio using the broader market's 5-year expected EPS growth rate of 17.2%, because the growth rate implied by STMicroelectronics's past and expected EPS is probably not sustainable. This more prudent approach shows a PEG ratio of 0.68, which still suggests that company's shares are possibly undervalued.
Furthermore, STMicroelectronics is likely undervalued in terms of its equity because its P/B ratio is 3.4 compared to its sector average of 6.23. The company's shares are currently trading 86.3% above their fair value as expressed by Benjamin Graham's formula:
√(22.5 * 4-year average EPS * book value per share) = √(22.5 * 2.17 * 14.869) = $26.94
Most of the Market Indicators on STMicroelectronics Are Negative:
8 analysts are following STMicroelectronics and have set target prices ranging from $36.0 to $78.0 per share. On average, they have given the company a rating of buy. At the current price of $50.21, STM is trading -14.9% away from its average analyst target price of $59.0 per share, implying an analyst consensus of some upside potential for the stock.
