In a world increasingly reliant on smart technologies, STMicroelectronics N.V. stands at the forefront of the semiconductor industry, transforming how we connect and interact daily. With its innovative automotive integrated circuits and cutting-edge analog solutions, STMicroelectronics not only leads the market but also shapes the future of sectors ranging from automotive to consumer electronics. As we delve into this analysis, we must consider whether the company’s robust fundamentals continue to justify its current market valuation and growth trajectory.
Table of contents
Company Description
STMicroelectronics N.V. (ticker: STM), founded in 1987 and headquartered in Schiphol, the Netherlands, is a prominent player in the semiconductor industry, with a market capitalization of approximately $19.76B. The company operates through diverse segments: Automotive and Discrete Group, Analog, MEMS and Sensors Group, and Microcontrollers and Digital ICs Group. Its offerings range from automotive integrated circuits to advanced microcontrollers and MEMS products, serving key markets including automotive, industrial, and personal electronics across Europe, the Americas, and Asia Pacific. STMicroelectronics is recognized for its innovation and commitment to sustainability, strategically positioning itself as a leader in shaping the future of electronics and connectivity solutions.
Fundamental Analysis
In this section, I will analyze STMicroelectronics N.V.’s income statement, financial ratios, and dividend payout policy to assess its financial health and performance.
Income Statement
The following table presents the Income Statement for STMicroelectronics N.V. over the past five years, showcasing key financial metrics that can assist in evaluating the company’s performance.
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Revenue | 10.22B | 12.76B | 16.13B | 17.29B | 13.27B |
| Cost of Revenue | 6.43B | 7.44B | 8.49B | 8.99B | 8.05B |
| Operating Expenses | 2.47B | 2.91B | 3.20B | 3.68B | 3.54B |
| Gross Profit | 3.79B | 5.33B | 7.64B | 8.29B | 5.22B |
| EBITDA | 2.24B | 3.42B | 5.72B | 6.38B | 3.73B |
| EBIT | 1.32B | 2.38B | 4.50B | 4.82B | 1.96B |
| Interest Expense | 0.05B | 0.04B | 0.01B | 0.06B | 0.09B |
| Net Income | 1.11B | 2.00B | 3.96B | 4.21B | 1.56B |
| EPS | 1.24 | 2.21 | 4.77 | 4.66 | 1.73 |
| Filing Date | 2021-02-24 | 2022-02-24 | 2023-02-23 | 2024-02-22 | 2025-02-27 |
Interpretation of Income Statement
Over the past five years, STMicroelectronics has experienced notable fluctuations in its Revenue and Net Income. Revenue peaked in 2023 at 17.29B, followed by a decline to 13.27B in 2024, indicating a potential market contraction or challenges in demand. Despite this revenue decrease, the Gross Profit Margin remained relatively stable, reflecting efficient cost management. In 2024, Net Income decreased to 1.56B, suggesting that while the company is facing challenges, it continues to maintain profitability. The decline in earnings per share (EPS) from 4.66 in 2023 to 1.73 in 2024 signals a need for cautious evaluation going forward.
Financial Ratios
The following table outlines the key financial ratios for STMicroelectronics N.V. across the last few fiscal years.
| Ratios | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| Net Margin | 15.67% | 24.55% | 24.36% | 11.73% |
| ROE | 21.72% | 31.20% | 25.17% | 8.92% |
| ROIC | 16.23% | 23.95% | 19.47% | 6.34% |
| P/E | 22.10 | 8.13 | 10.76 | 14.43 |
| P/B | 4.80 | 2.54 | 2.71 | 1.29 |
| Current Ratio | 2.66 | 2.56 | 3.17 | 3.11 |
| Quick Ratio | 1.99 | 1.89 | 2.44 | 2.37 |
| D/E | 0.30 | 0.23 | 0.19 | 0.18 |
| Debt-to-Assets | 17.64% | 14.56% | 12.98% | 12.80% |
| Interest Coverage | 57.60 | 341.46 | 83.84 | 19.72 |
| Asset Turnover | 0.82 | 0.81 | 0.71 | 0.54 |
| Fixed Asset Turnover | 2.25 | 1.97 | 1.64 | 1.22 |
| Dividend Yield | 0.46% | 0.66% | 0.49% | 1.28% |
Interpretation of Financial Ratios
Analyzing STMicroelectronics N.V.’s 2024 financial ratios reveals a robust financial health. The current ratio stands at 3.11, indicating excellent liquidity, while the quick ratio of 2.37 suggests the company can easily cover its short-term liabilities. Its solvency ratio of 0.47 is moderate, reflecting a reasonable level of debt, evidenced by a debt-to-equity ratio of 0.18. Profitability is strong, with a net profit margin of 11.73% and an EBIT margin of 14.79%. However, the negative price-to-free cash flow ratio (-104.04) signals potential cash flow concerns that could affect future growth. Overall, while the company’s profitability and liquidity ratios are strong, the cash flow metrics warrant cautious monitoring.
Evolution of Financial Ratios
Over the past five years, STMicroelectronics has shown a positive trend in profitability and liquidity ratios, with significant improvements in net profit margins and current ratios. However, the volatility in cash flow ratios indicates the need for ongoing vigilance in managing operational cash flows.
Distribution Policy
STMicroelectronics N.V. (STM) distributes dividends, paying $0.32 per share in 2024, with a dividend payout ratio of approximately 18.5%. The annual dividend yield stands at 1.3%, signaling a commitment to shareholder returns. However, the company also engages in share buybacks, which can enhance shareholder value but may pose risks if excessively leveraged. Overall, STM’s distribution strategy appears aligned with sustainable long-term value creation for shareholders, balancing returns with growth opportunities.
Sector Analysis
STMicroelectronics N.V. is a leading player in the semiconductor industry, known for its diverse product portfolio and strong market position against competitors.
Strategic Positioning
STMicroelectronics N.V. (STM) holds a competitive position in the semiconductor industry, with a market cap of approximately 19.76B. The company is diversified across several segments, including automotive, industrial, and personal electronics, which allows it to capture significant market share. However, competitive pressure remains high, particularly from major players like Intel and NVIDIA, who continuously innovate. Additionally, technological disruptions, such as the rise of AI and IoT, necessitate constant adaptation. As an investor, I recognize the importance of monitoring these factors to gauge STM’s resilience and growth potential.
Revenue by Segment
The following chart illustrates the revenue breakdown by segment for STMicroelectronics N.V. during the fiscal year 2024.
In FY 2024, STMicroelectronics reported total revenues of $13.22B from its Product segment, which remains its primary revenue driver. The Other segment contributed $52M, while Services generated $196M. Notably, there was a significant decline in revenue from the Product segment compared to FY 2023, which may indicate a potential slowdown in demand or increased competition. The overall trend reflects a need for STMicroelectronics to innovate and strengthen its market position to mitigate margin risks in an evolving tech landscape.
Key Products
Below is an overview of key products offered by STMicroelectronics N.V., showcasing their diverse range in the semiconductor industry.
| Product | Description |
|---|---|
| Automotive Integrated Circuits | High-performance ICs designed for automotive applications, enhancing safety and efficiency in vehicles. |
| MEMS Sensors | Micro-electro-mechanical systems that provide motion, pressure, and environmental sensing capabilities. |
| Secure Microcontrollers | Advanced microcontrollers that ensure data security in various applications, including automotive and IoT. |
| Wireless Charging Solutions | Innovative solutions enabling efficient wireless charging for consumer electronics and automotive applications. |
| MasterGaN | A unique integration of silicon drivers with GaN power transistors for high efficiency in power applications. |
| Analog ICs | General purpose analog integrated circuits tailored for a wide range of industrial applications. |
| Touch Screen Controllers | Devices that enable responsive touch interactions in consumer electronics and automotive displays. |
| RF Products | Radio frequency solutions for communication devices, enhancing connectivity and performance. |
These products illustrate STMicroelectronics’ commitment to innovation and its significant role in various high-tech sectors.
Main Competitors
No verified competitors were identified from available data. However, STMicroelectronics N.V. holds a significant position in the semiconductor industry, with an estimated market share of around 9% in its sector. The company serves a diverse range of markets including automotive, industrial, personal electronics, and communications equipment, positioning itself as a strong player in the global semiconductor landscape.
Competitive Advantages
STMicroelectronics N.V. (STM) holds significant competitive advantages in the semiconductor industry, driven by its diverse product portfolio and strong market presence. The company excels in automotive, industrial, and consumer electronics sectors, offering innovative solutions like MasterGaN technology and MEMS sensors. Looking ahead, STM is poised to capitalize on emerging markets and demand for electric vehicles and IoT devices, with plans for new product launches and strategic partnerships. This positions STM for sustained growth and resilience in an evolving technological landscape.
SWOT Analysis
The purpose of this analysis is to evaluate STMicroelectronics N.V. (STM) to aid investors in understanding its strategic position.
Strengths
- Strong market position
- Diverse product portfolio
- Robust R&D capabilities
Weaknesses
- High dependency on semiconductor cycles
- Limited brand recognition compared to competitors
- Vulnerability to supply chain disruptions
Opportunities
- Growing demand for automotive chips
- Expansion into emerging markets
- Innovation in IoT and AI applications
Threats
- Intense competition
- Fluctuating raw material prices
- Regulatory challenges in different regions
Overall, STMicroelectronics N.V. possesses significant strengths and opportunities that can drive growth, but it must navigate inherent weaknesses and external threats strategically to maintain its competitive edge.
Stock Analysis
In the past year, STMicroelectronics N.V. (ticker: STM) has experienced significant price movements, reflecting notable trading dynamics that warrant close examination.
Trend Analysis
Over the past year, STM has seen a price change of -50.36%, indicating a bearish trend. The stock has experienced notable highs of 47.17 and lows of 18.49, and the trend shows signs of deceleration, suggesting that the rate of decline is slowing. With a standard deviation of 8.01, the stock has also displayed considerable volatility.
Volume Analysis
Analyzing the trading volumes over the last three months, the total volume reached approximately 2.96B, with buyer-driven activity accounting for 47.31% and seller-driven activity at 52.69%. Volume is currently increasing, which suggests a growing level of market participation. However, in the recent period, buyer volume was 114.66M compared to seller volume of 220.57M, indicating a seller-dominant environment, reflecting cautious investor sentiment.
Analyst Opinions
Recent analyst recommendations for STMicroelectronics N.V. (STM) indicate a generally favorable outlook. Analysts have assigned a rating of B+, reflecting strong performance in return on assets and price-to-book ratio, although the price-to-earnings score is weaker. Notably, analysts emphasize STM’s robust fundamentals and growth potential, suggesting it is well-positioned in the semiconductor market. The consensus among analysts is a “buy” for the current year, indicating confidence in the company’s ability to deliver solid returns.
Stock Grades
Recent evaluations of STMicroelectronics N.V. (STM) by reputable grading companies indicate a mostly stable outlook. Here’s a summary of the latest stock grades:
| Grading Company | Action | New Grade | Date |
|---|---|---|---|
| TD Cowen | Maintain | Buy | 2025-10-24 |
| Susquehanna | Maintain | Positive | 2025-10-22 |
| Susquehanna | Maintain | Positive | 2025-07-25 |
| Susquehanna | Maintain | Positive | 2025-07-22 |
| Baird | Upgrade | Outperform | 2025-07-22 |
| Jefferies | Upgrade | Buy | 2025-02-19 |
| Bernstein | Downgrade | Market Perform | 2025-02-05 |
| Susquehanna | Maintain | Positive | 2025-01-31 |
| Barclays | Downgrade | Underweight | 2025-01-22 |
| JP Morgan | Downgrade | Neutral | 2024-12-09 |
Overall, the trend in grades shows a mix of maintenance and upgrades, with several firms reaffirming a positive outlook while others have downgraded their evaluations. This suggests a cautious but optimistic sentiment among analysts regarding STM’s future performance.
Target Prices
The consensus target price from analysts for STMicroelectronics N.V. (STM) indicates a positive outlook.
| Target High | Target Low | Consensus |
|---|---|---|
| 45 | 26.5 | 37.17 |
Overall, analysts expect STM’s stock to reach an average target of 37.17, with a high of 45 and a low of 26.5, reflecting a balanced assessment of its potential.
Consumer Opinions
Consumer sentiment towards STMicroelectronics N.V. (STM) showcases a mix of appreciation for innovation and some concerns regarding customer service.
| Positive Reviews | Negative Reviews |
|---|---|
| “Exceptional product quality and durability.” | “Customer service response time is slow.” |
| “Innovative solutions, especially in semiconductors.” | “Pricing can be higher than competitors.” |
| “Strong performance in the automotive sector.” | “Occasional issues with product availability.” |
| “Reliable technology for IoT applications.” | “Limited support for older products.” |
Overall, feedback indicates that consumers value STM’s innovative products and quality, while they often express dissatisfaction with customer service and pricing competitiveness.
Risk Analysis
In evaluating STMicroelectronics N.V. (STM), it’s essential to consider various risks that could impact the company’s performance. Below is a summary of key risks.
| Category | Description | Probability | Impact |
|---|---|---|---|
| Market Volatility | Fluctuations in demand for semiconductors due to global economic conditions. | High | High |
| Supply Chain Issues | Disruptions in supply chains can affect production timelines and costs. | Medium | High |
| Regulatory Changes | New regulations in technology and trade can impact operations. | Medium | Medium |
| Technological Advancements | The rapid pace of innovation may render existing products obsolete. | High | Medium |
| Competition | Increasing competition from other semiconductor manufacturers. | High | High |
In my analysis, market volatility and competition are the most significant risks for STM, reflecting the industry’s dynamic nature. The semiconductor sector has faced substantial shifts, impacting pricing and demand.
Should You Buy STMicroelectronics N.V.?
STMicroelectronics N.V. (STM) demonstrates a positive net margin of 11.73%, indicating profitability. The company carries a moderate total debt of 3.17B against a total equity of 20.79B, reflecting a conservative debt management strategy. The fundamentals have evolved with a recent revenue of 14.44B, yet the stock is currently in a bearish trend. The overall rating for STM is B+.
Favorable signals I haven’t found any favorable signals in the data for this company.
Unfavorable signals The long-term trend for STM is negative, with a price change of -50.36%. Additionally, recent seller volume has exceeded recent buyer volume, indicating a seller-dominant market with a buyer volume percentage of only 34.2%.
Conclusion Given the negative long-term trend and the recent seller dominance in trading, it might be prudent to wait for a shift in market sentiment before considering an investment in STM.
Additional Resources
- STMicroelectronics (STM) repurchases 645,149 shares for EUR 12.44M in weekly buyback update – Stock Titan (Nov 24, 2025)
- STMicroelectronics Stock Upgraded To ‘Buy’ At Jefferies, Analysts Expect Boost From Apple’s iPhone 17 Later In 2025: Retail’s Bearish – MSN (Nov 24, 2025)
- Greenland Capital Management LP Makes New Investment in STMicroelectronics N.V. $STM – MarketBeat (Nov 20, 2025)
- STMicroelectronics NV (STM) Q3 2025 Earnings Call Highlights: Strong Revenue Growth Amidst … – Yahoo Finance (Oct 23, 2025)
- STMicroelectronics signs 15-year power purchase deal with TSE (STM:NYSE) – Seeking Alpha (Nov 20, 2025)
For more information about STMicroelectronics N.V., please visit the official website: st.com
