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STMICROELECTRONICS NV (STM.PA) Stock Fundamental Analysis

EPA:STM - Euronext Paris - Matif - NL0000226223 - Common Stock - Currency: EUR

46.26  -0.78 (-1.66%)

Fundamental Rating

6

STM gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 55 industry peers in the Semiconductors & Semiconductor Equipment industry. Both the profitability and the financial health of STM get a neutral evaluation. Nothing too spectacular is happening here. STM is growing strongly while it is still valued neutral. This is a good combination! With these ratings, STM could be worth investigating further for growth investing!.


Dividend Valuation Growth Profitability Health

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6

1. Profitability

1.1 Basic Checks

In the past year STM was profitable.
STM had a positive operating cash flow in the past year.
STM had positive earnings in 4 of the past 5 years.
Of the past 5 years STM 4 years had a positive operating cash flow.
STM.PA Yearly Net Income VS EBIT VS OCF VS FCFSTM.PA Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 1B 2B 3B

1.2 Ratios

STM has a Return On Assets of 15.90%. This is in the better half of the industry: STM outperforms 70.83% of its industry peers.
STM has a Return On Equity of 26.25%. This is in the better half of the industry: STM outperforms 64.58% of its industry peers.
With a decent Return On Invested Capital value of 21.37%, STM is doing good in the industry, outperforming 70.83% of the companies in the same industry.
STM had an Average Return On Invested Capital over the past 3 years of 21.52%. This is significantly above the industry average of 15.29%.
Industry RankSector Rank
ROA 15.9%
ROE 26.25%
ROIC 21.37%
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)21.52%
ROIC(5y)N/A
STM.PA Yearly ROA, ROE, ROICSTM.PA Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 5 10 15 20

1.3 Margins

The Profit Margin of STM (20.41%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of STM has grown nicely.
Looking at the Operating Margin, with a value of 25.31%, STM is in line with its industry, outperforming 58.33% of the companies in the same industry.
STM's Operating Margin has improved in the last couple of years.
The Gross Margin of STM (43.75%) is worse than 62.50% of its industry peers.
STM's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 25.31%
PM (TTM) 20.41%
GM 43.75%
OM growth 3Y11.15%
OM growth 5Y31.46%
PM growth 3Y-7.35%
PM growth 5Y50.52%
GM growth 3Y2.45%
GM growth 5Y3.8%
STM.PA Yearly Profit, Operating, Gross MarginsSTM.PA Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 10 20 30

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6

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), STM is creating value.
STM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
STM.PA Yearly Shares OutstandingSTM.PA Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 200M 400M 600M 800M
STM.PA Yearly Total Debt VS Total AssetsSTM.PA Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 5B 10B 15B

2.2 Solvency

An Altman-Z score of 5.94 indicates that STM is not in any danger for bankruptcy at the moment.
STM has a Altman-Z score of 5.94. This is in the better half of the industry: STM outperforms 64.58% of its industry peers.
STM has a debt to FCF ratio of 2.18. This is a good value and a sign of high solvency as STM would need 2.18 years to pay back of all of its debts.
STM has a Debt to FCF ratio (2.18) which is comparable to the rest of the industry.
A Debt/Equity ratio of 0.20 indicates that STM is not too dependend on debt financing.
The Debt to Equity ratio of STM (0.20) is better than 64.58% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.2
Debt/FCF 2.18
Altman-Z 5.94
ROIC/WACC2.48
WACC8.6%
STM.PA Yearly LT Debt VS Equity VS FCFSTM.PA Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2B 4B 6B 8B

2.3 Liquidity

STM has a Current Ratio of 2.28. This indicates that STM is financially healthy and has no problem in meeting its short term obligations.
STM has a Current ratio of 2.28. This is comparable to the rest of the industry: STM outperforms 47.92% of its industry peers.
STM has a Quick Ratio of 1.65. This is a normal value and indicates that STM is financially healthy and should not expect problems in meeting its short term obligations.
STM's Quick ratio of 1.65 is in line compared to the rest of the industry. STM outperforms 54.17% of its industry peers.
Industry RankSector Rank
Current Ratio 2.28
Quick Ratio 1.65
STM.PA Yearly Current Assets VS Current LiabilitesSTM.PA Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2B 4B 6B

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7

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 76.74% over the past year.
STM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 50.47% yearly.
Looking at the last year, STM shows a quite strong growth in Revenue. The Revenue has grown by 18.70% in the last year.
The Revenue has been growing by 12.85% on average over the past years. This is quite good.
EPS 1Y (TTM)76.74%
EPS 3Y15.01%
EPS 5Y50.47%
EPS Q2Q%109.09%
Revenue 1Y (TTM)18.7%
Revenue growth 3Y9.71%
Revenue growth 5Y12.85%
Sales Q2Q%22.89%

3.2 Future

The Earnings Per Share is expected to grow by 11.34% on average over the next years. This is quite good.
Based on estimates for the next years, STM will show a quite strong growth in Revenue. The Revenue will grow by 10.85% on average per year.
EPS Next Y83.51%
EPS Next 2Y37.07%
EPS Next 3Y25.67%
EPS Next 5Y11.34%
Revenue Next Year27.05%
Revenue Next 2Y16.06%
Revenue Next 3Y12.4%
Revenue Next 5Y10.85%

3.3 Evolution

Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
STM.PA Yearly Revenue VS EstimatesSTM.PA Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 5B 10B 15B 20B
STM.PA Yearly EPS VS EstimatesSTM.PA Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1 2 3 4

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6

4. Valuation

4.1 Price/Earnings Ratio

STM is valuated correctly with a Price/Earnings ratio of 16.17.
68.75% of the companies in the same industry are more expensive than STM, based on the Price/Earnings ratio.
STM's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.35.
With a Price/Forward Earnings ratio of 12.11, STM is valued correctly.
Based on the Price/Forward Earnings ratio, STM is valued cheaper than 91.67% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.19. STM is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE 16.17
Fwd PE 12.11
STM.PA Price Earnings VS Forward Price EarningsSTM.PA Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of STM indicates a rather cheap valuation: STM is cheaper than 85.42% of the companies listed in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as STM.
Industry RankSector Rank
P/FCF 40.61
EV/EBITDA 8.61
STM.PA Per share dataSTM.PA EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10

4.3 Compensation for Growth

STM's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
STM has a very decent profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as STM's earnings are expected to grow with 25.67% in the coming years.
PEG (NY)0.19
PEG (5Y)0.32
EPS Next 2Y37.07%
EPS Next 3Y25.67%

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2

5. Dividend

5.1 Amount

With a yearly dividend of 0.41%, STM is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 1.26, STM has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.42, STM's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 0.41%

5.2 History

Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0

5.3 Sustainability

7.56% of the earnings are spent on dividend by STM. This is a low number and sustainable payout ratio.
DP7.56%
EPS Next 2Y37.07%
EPS Next 3Y25.67%
STM.PA Yearly Income VS Free CF VS DividendSTM.PA Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2015 2016 2017 2018 2019 2020 2021 500M 1B 1.5B
STM.PA Dividend Payout.STM.PA Dividend Payout, showing the Payout Ratio.STM.PA Dividend Payout.PayoutRetained Earnings

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STMICROELECTRONICS NV

EPA:STM (3/10/2023, 7:00:00 PM)

46.26

-0.78 (-1.66%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)N/A N/A
Earnings (Next)N/A N/A
Inst OwnersN/A
Inst Owner ChangeN/A
Ins OwnersN/A
Ins Owner ChangeN/A
Market Cap41.78B
Analysts75.65
Price Target56.87 (22.94%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 0.41%
Yearly Dividend0.23
Dividend Growth(5Y)N/A
DP7.56%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)21.94%
Min EPS beat(2)20.24%
Max EPS beat(2)23.64%
EPS beat(4)3
Avg EPS beat(4)14.95%
Min EPS beat(4)-0.42%
Max EPS beat(4)23.64%
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)1
Avg Revenue beat(2)99.27%
Min Revenue beat(2)99.27%
Max Revenue beat(2)99.27%
Revenue beat(4)2
Avg Revenue beat(4)95.59%
Min Revenue beat(4)91.9%
Max Revenue beat(4)99.27%
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)1.28%
PT rev (3m)14.67%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0%
EPS NY rev (1m)-0.45%
EPS NY rev (3m)-0.45%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-0.01%
Valuation
Industry RankSector Rank
PE 16.17
Fwd PE 12.11
P/S 3.14
P/FCF 40.61
P/OCF 10.61
P/B 4.04
P/tB 4.8
EV/EBITDA 8.61
EPS(TTM)2.86
EY6.18%
EPS(NY)3.82
Fwd EY8.26%
FCF(TTM)1.14
FCFY2.46%
OCF(TTM)4.36
OCFY9.43%
SpS14.73
BVpS11.46
TBVpS9.64
PEG (NY)0.19
PEG (5Y)0.32
Profitability
Industry RankSector Rank
ROA 15.9%
ROE 26.25%
ROCE N/A
ROIC 21.37%
ROICexc 28.07%
ROICexgc 33.38%
OM 25.31%
PM (TTM) 20.41%
GM 43.75%
FCFM N/A
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)21.52%
ROIC(5y)N/A
ROICexc(3y)17.46%
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y8.25%
ROICexcg growth 5Y30.31%
ROICexc growth 3Y8.93%
ROICexc growth 5Y31.87%
OM growth 3Y11.15%
OM growth 5Y31.46%
PM growth 3Y-7.35%
PM growth 5Y50.52%
GM growth 3Y2.45%
GM growth 5Y3.8%
F-Score9
Asset Turnover0.78
Health
Industry RankSector Rank
Debt/Equity 0.2
Debt/FCF 2.18
Debt/EBITDA 0.48
Cap/Depr 220.07%
Cap/Sales N/A
Interest Coverage N/A
Cash Conversion N/A
Profit Quality 37.89%
Current Ratio 2.28
Quick Ratio 1.65
Altman-Z 5.94
F-Score9
WACC8.6%
ROIC/WACC2.48
Cap/Depr(3y)141.78%
Cap/Depr(5y)154.19%
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)118.78%
Profit Quality(5y)107.58%
High Growth Momentum
Growth
EPS 1Y (TTM)76.74%
EPS 3Y15.01%
EPS 5Y50.47%
EPS Q2Q%109.09%
EPS Next Y83.51%
EPS Next 2Y37.07%
EPS Next 3Y25.67%
EPS Next 5Y11.34%
Revenue 1Y (TTM)18.7%
Revenue growth 3Y9.71%
Revenue growth 5Y12.85%
Sales Q2Q%22.89%
Revenue Next Year27.05%
Revenue Next 2Y16.06%
Revenue Next 3Y12.4%
Revenue Next 5Y10.85%
EBIT growth 1Y81.81%
EBIT growth 3Y21.94%
EBIT growth 5Y48.36%
EBIT Next Year143.02%
EBIT Next 3Y40.91%
EBIT Next 5Y22.32%
FCF growth 1Y22.4%
FCF growth 3Y32.22%
FCF growth 5Y25.21%
OCF growth 1Y80.86%
OCF growth 3Y17.89%
OCF growth 5Y21.42%