ROUNDUP: Chip manufacturer STMicroelectronics convinces with forecast
GENEVA Last year, STMicro’s revenue rose a little more than a quarter to $16.1 billion. The surplus of the Italian-French company was almost four billion dollars, almost twice as high as the year before. Operating profit increased by more than 80 percent to $4.4 billion. When looking at the past year, STMicro fulfilled the expectations of the analysts.
The view of the start of the current year was significantly better than expected. Revenue of around $4.2 billion is expected in the first quarter, almost a fifth more than a year ago. The margin should continue to improve. In order to be able to cope with the expected high demand, CEO Chery wants to invest another four billion in the current year – among other things in the expansion of capacities. He is thus continuing to increase investments: in 2022, capital expenditures totaled around three and a half billion dollars.
Analysts especially praised the company’s outlook and prospects. CitigroupExpert Andrew Gardiner considers the paper to be undervalued with a price-earnings ratio of eleven compared to the expected 2023 profit. He rates the paper as “Buy” and a price target of EUR 58. According to his assessment, the share still has around 40 percent room for improvement.
With a view to the STMicro course, Gardiner is one of the biggest optimists among the stock experts, but the average price target of almost 50 euros is also well above the current level. After the forecast for the current year and the first few months was announced on Thursday, the price rose to a good 43 euros and thus to the highest level in a little over a year. However, the paper was not quite able to maintain this level over the course of the year.
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At noon, the course was up around six percent at EUR 41.93. The shares of the German chip manufacturer Infineon became more expensive by up to five percent, as did other values such as AMS-Osram or the papers of the outfitters Aixtron and ASML Owned by STM Lookout.