STMicroelectronics N.V.
STMicroelectronics N.V. Fundamental Analysis
STMicroelectronics N.V. (STM.PA) shows strong financial fundamentals with a PE ratio of 11.34, profit margin of 26.80%, and ROE of 37.66%. The company generates $16.1B in annual revenue with weak year-over-year growth of -23.24%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 42.5/100 based on profitability, valuation, growth, and balance sheet metrics. The D grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze STM.PA's fundamental strength across five key dimensions:
Efficiency Score
ExcellentSTM.PA demonstrates superior asset utilization.
Valuation Score
ExcellentSTM.PA trades at attractive valuation levels.
Growth Score
WeakSTM.PA faces weak or negative growth trends.
Financial Health Score
ExcellentSTM.PA maintains a strong and stable balance sheet.
Profitability Score
ExcellentSTM.PA achieves industry-leading margins.
Key Financial Metrics
Is STM.PA Expensive or Cheap?
P/E Ratio
STM.PA trades at 11.34 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, STM.PA's PEG of 0.10 indicates potential undervaluation.
Price to Book
The market values STMicroelectronics N.V. at 3.65 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 7.62 times EBITDA. This is generally considered low.
How Well Does STM.PA Make Money?
Net Profit Margin
For every $100 in sales, STMicroelectronics N.V. keeps $26.80 as profit after all expenses.
Operating Margin
Core operations generate 28.11 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $37.66 in profit for every $100 of shareholder equity.
ROA
STMicroelectronics N.V. generates $20.60 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
STMicroelectronics N.V. generates strong operating cash flow of $5.56B, reflecting robust business health.
Free Cash Flow
STMicroelectronics N.V. produces free cash flow of $1.60B, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.77 in free cash annually.
FCF Yield
STM.PA converts 3.28% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
11.34
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.10
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.65
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.03
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.19
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.10
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.38
vs 25 benchmark
ROA
Return on assets percentage
0.21
vs 25 benchmark
ROCE
Return on capital employed
0.28
vs 25 benchmark
How STM.PA Stacks Against Its Sector Peers
| Metric | STM.PA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 11.34 | 34.36 | Better (Cheaper) |
| ROE | 37.66% | 1017.00% | Weak |
| Net Margin | 26.80% | -101936.00% (disorted) | Strong |
| Debt/Equity | 0.19 | 0.45 | Strong (Low Leverage) |
| Current Ratio | 2.10 | 6.16 | Strong Liquidity |
| ROA | 20.60% | -291075.00% (disorted) | Strong |
STM.PA outperforms its industry in 5 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews STMicroelectronics N.V.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
37.98%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
49.92%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
57.72%
Industry Style: Growth, Innovation, High Beta
High Growth