STMICROELECTRONICS NV-NY SHS (STM) Stock Fundamental Analysis
NYSE:STM - New York Stock Exchange, Inc. - US8610121027 - Currency: USD
STM gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 110 industry peers in the Semiconductors & Semiconductor Equipment industry. While STM has a great profitability rating, there are some minor concerns on its financial health. STM has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year STM was profitable.
In the past year STM had a positive cash flow from operations.
STM had positive earnings in each of the past 5 years.
STM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
STM's Return On Assets of 7.71% is fine compared to the rest of the industry. STM outperforms 74.55% of its industry peers.
STM has a better Return On Equity (10.78%) than 69.09% of its industry peers.
The Return On Invested Capital of STM (7.86%) is better than 75.45% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for STM is significantly above the industry average of 11.32%.
The last Return On Invested Capital (7.86%) for STM is well below the 3 year average (17.63%), which needs to be investigated, but indicates that STM had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 10.78% | ||
| ROIC | 7.86% |
ROA(3y)15.52%
ROA(5y)12.31%
ROE(3y)23.34%
ROE(5y)19.28%
ROIC(3y)17.63%
ROIC(5y)15.95%
1.3 Margins
STM has a better Profit Margin (14.97%) than 73.64% of its industry peers.
STM's Profit Margin has improved in the last couple of years.
STM has a better Operating Margin (14.36%) than 72.73% of its industry peers.
STM's Operating Margin has improved in the last couple of years.
STM has a worse Gross Margin (37.74%) than 60.91% of its industry peers.
In the last couple of years the Gross Margin of STM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 14.36% | ||
| PM (TTM) | 14.97% | ||
| GM | 37.74% |
OM growth 3Y-10.37%
OM growth 5Y2.22%
PM growth 3Y3.75%
PM growth 5Y29.89%
GM growth 3Y-1.84%
GM growth 5Y1.2%
2. Health
2.1 Basic Checks
STM has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, STM has a worse debt to assets ratio.
2.2 Solvency
STM has an Altman-Z score of 3.57. This indicates that STM is financially healthy and has little risk of bankruptcy at the moment.
STM has a Altman-Z score (3.57) which is in line with its industry peers.
STM has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.07, STM perfoms like the industry average, outperforming 55.45% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.07 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 3.57 |
ROIC/WACC0.77
WACC10.17%
2.3 Liquidity
STM has a Current Ratio of 2.60. This indicates that STM is financially healthy and has no problem in meeting its short term obligations.
Looking at the Current ratio, with a value of 2.60, STM is in line with its industry, outperforming 40.91% of the companies in the same industry.
A Quick Ratio of 1.98 indicates that STM should not have too much problems paying its short term obligations.
STM has a Quick ratio (1.98) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.6 | ||
| Quick Ratio | 1.98 |
3. Growth
3.1 Past
STM shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -69.49%.
The Earnings Per Share has been growing slightly by 7.62% on average over the past years.
STM shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -23.24%.
STM shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 6.79% yearly.
EPS 1Y (TTM)-69.49%
EPS 3Y-8.4%
EPS 5Y7.62%
EPS Q2Q%-87.04%
Revenue 1Y (TTM)-23.24%
Revenue growth 3Y1.31%
Revenue growth 5Y6.79%
Sales Q2Q%-27.36%
3.2 Future
The Earnings Per Share is expected to grow by 17.72% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.06% on average over the next years. This is quite good.
EPS Next Y-52.53%
EPS Next 2Y2.42%
EPS Next 3Y14.06%
EPS Next 5Y17.72%
Revenue Next Year-13.99%
Revenue Next 2Y-1.97%
Revenue Next 3Y3.09%
Revenue Next 5Y9.06%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.71, the valuation of STM can be described as rather expensive.
Based on the Price/Earnings ratio, STM is valued a bit cheaper than the industry average as 76.36% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 28.22. STM is valued slightly cheaper when compared to this.
With a Price/Forward Earnings ratio of 13.47, STM is valued correctly.
Compared to the rest of the industry, the Price/Forward Earnings ratio of STM indicates a rather cheap valuation: STM is cheaper than 84.55% of the companies listed in the same industry.
STM's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 20.86.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.71 | ||
| Fwd PE | 13.47 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, STM is valued cheaply inside the industry as 95.45% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 3.62 |
4.3 Compensation for Growth
The decent profitability rating of STM may justify a higher PE ratio.
STM's earnings are expected to grow with 14.06% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)2.59
EPS Next 2Y2.42%
EPS Next 3Y14.06%
5. Dividend
5.1 Amount
STM has a Yearly Dividend Yield of 1.61%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.75, STM pays a better dividend. On top of this STM pays more dividend than 83.64% of the companies listed in the same industry.
STM's Dividend Yield is slightly below the S&P500 average, which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
5.2 History
The dividend of STM has a limited annual growth rate of 0.51%.
STM has been paying a dividend for at least 10 years, so it has a reliable track record.
STM has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)0.51%
Div Incr Years1
Div Non Decr Years4
5.3 Sustainability
STM pays out 14.49% of its income as dividend. This is a sustainable payout ratio.
The dividend of STM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP14.49%
EPS Next 2Y2.42%
EPS Next 3Y14.06%
23.45
+0.71 (+3.12%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSemiconductors & Semiconductor Equipment
GICS IndustrySemiconductors & Semiconductor Equipment
Earnings (Last)
Earnings (Next)
Inst Owners29.73%
Inst Owner Change4.15%
Ins Owners0%
Ins Owner ChangeN/A
Market Cap21.37B
Analysts75.17
Price Target32.01 (36.5%)
Short Float %1.76%
Short Ratio1.35
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.61% |
Yearly Dividend0.25
Dividend Growth(5Y)0.51%
DP14.49%
Div Incr Years1
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.89%
Min EPS beat(2)2.3%
Max EPS beat(2)13.48%
EPS beat(4)3
Avg EPS beat(4)2.24%
Min EPS beat(4)-7.15%
Max EPS beat(4)13.48%
EPS beat(8)6
Avg EPS beat(8)3.97%
EPS beat(12)10
Avg EPS beat(12)8.21%
EPS beat(16)13
Avg EPS beat(16)7.72%
Revenue beat(2)0
Avg Revenue beat(2)-2.55%
Min Revenue beat(2)-2.69%
Max Revenue beat(2)-2.41%
Revenue beat(4)0
Avg Revenue beat(4)-3.52%
Min Revenue beat(4)-6.85%
Max Revenue beat(4)-2.12%
Revenue beat(8)0
Avg Revenue beat(8)-2.96%
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)0.8%
PT rev (3m)2.39%
EPS NQ rev (1m)-48.97%
EPS NQ rev (3m)-76.59%
EPS NY rev (1m)-15.51%
EPS NY rev (3m)-41.5%
Revenue NQ rev (1m)-0.5%
Revenue NQ rev (3m)-7.84%
Revenue NY rev (1m)-1.59%
Revenue NY rev (3m)-10.61%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.71 | ||
| Fwd PE | 13.47 | ||
| P/S | 1.61 | ||
| P/FCF | N/A | ||
| P/OCF | 6.39 | ||
| P/B | 1.16 | ||
| P/tB | 1.28 | ||
| EV/EBITDA | 3.62 |
EPS(TTM)1.19
EY5.07%
EPS(NY)1.74
Fwd EY7.43%
FCF(TTM)-0.21
FCFYN/A
OCF(TTM)3.67
OCFY15.64%
SpS14.56
BVpS20.23
TBVpS18.27
PEG (NY)N/A
PEG (5Y)2.59
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 10.78% | ||
| ROCE | 8.97% | ||
| ROIC | 7.86% | ||
| ROICexc | 11.08% | ||
| ROICexgc | 12.57% | ||
| OM | 14.36% | ||
| PM (TTM) | 14.97% | ||
| GM | 37.74% | ||
| FCFM | N/A |
ROA(3y)15.52%
ROA(5y)12.31%
ROE(3y)23.34%
ROE(5y)19.28%
ROIC(3y)17.63%
ROIC(5y)15.95%
ROICexc(3y)24.99%
ROICexc(5y)22.51%
ROICexgc(3y)26.72%
ROICexgc(5y)25.26%
ROCE(3y)20.12%
ROCE(5y)18.2%
ROICexcg growth 3Y-22.57%
ROICexcg growth 5Y-8.43%
ROICexc growth 3Y-20.96%
ROICexc growth 5Y-6.72%
OM growth 3Y-10.37%
OM growth 5Y2.22%
PM growth 3Y3.75%
PM growth 5Y29.89%
GM growth 3Y-1.84%
GM growth 5Y1.2%
F-Score5
Asset Turnover0.52
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.07 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 0.35 | ||
| Cap/Depr | 171.94% | ||
| Cap/Sales | 26.64% | ||
| Interest Coverage | 24.11 | ||
| Cash Conversion | 84.37% | ||
| Profit Quality | N/A | ||
| Current Ratio | 2.6 | ||
| Quick Ratio | 1.98 | ||
| Altman-Z | 3.57 |
F-Score5
WACC10.17%
ROIC/WACC0.77
Cap/Depr(3y)232.76%
Cap/Depr(5y)199.58%
Cap/Sales(3y)26.55%
Cap/Sales(5y)22.73%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-69.49%
EPS 3Y-8.4%
EPS 5Y7.62%
EPS Q2Q%-87.04%
EPS Next Y-52.53%
EPS Next 2Y2.42%
EPS Next 3Y14.06%
EPS Next 5Y17.72%
Revenue 1Y (TTM)-23.24%
Revenue growth 3Y1.31%
Revenue growth 5Y6.79%
Sales Q2Q%-27.36%
Revenue Next Year-13.99%
Revenue Next 2Y-1.97%
Revenue Next 3Y3.09%
Revenue Next 5Y9.06%
EBIT growth 1Y-73.12%
EBIT growth 3Y-9.19%
EBIT growth 5Y9.16%
EBIT Next Year49.59%
EBIT Next 3Y40.29%
EBIT Next 5Y32.75%
FCF growth 1Y-113.14%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-47.5%
OCF growth 3Y-1.17%
OCF growth 5Y8.75%