STMicroelectronics (STM) Outperforms Broader Market: What You Need to Know
STMicroelectronics (STM) ended the recent trading session at $44.98, demonstrating a +1.56% swing from the preceding day's closing price. The stock outperformed the S&P 500, which registered a daily gain of 0.52%. Meanwhile, the Dow gained 0.4%, and the Nasdaq, a tech-heavy index, added 0.58%.
The the stock of chip company has fallen by 0.34% in the past month, leading the Computer and Technology sector's loss of 1.93% and the S&P 500's loss of 2.61%.
The investment community will be paying close attention to the earnings performance of STMicroelectronics in its upcoming release. The company is slated to reveal its earnings on October 26, 2023. The company is predicted to post an EPS of $1.08, indicating a 6.9% decline compared to the equivalent quarter last year. Our most recent consensus estimate is calling for quarterly revenue of $4.36 billion, up 0.88% from the year-ago period.
For the full year, the Zacks Consensus Estimates project earnings of $4.31 per share and a revenue of $17.36 billion, demonstrating changes of +2.86% and +7.63%, respectively, from the preceding year.
It's also important for investors to be aware of any recent modifications to analyst estimates for STMicroelectronics. These recent revisions tend to reflect the evolving nature of short-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, there's been a 0.47% rise in the Zacks Consensus EPS estimate. STMicroelectronics is currently sporting a Zacks Rank of #2 (Buy).
Valuation is also important, so investors should note that STMicroelectronics has a Forward P/E ratio of 10.28 right now. This expresses a discount compared to the average Forward P/E of 18.95 of its industry.
Meanwhile, STM's PEG ratio is currently 2.06. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. By the end of yesterday's trading, the Semiconductor - General industry had an average PEG ratio of 2.71.
The Semiconductor - General industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 28, this industry ranks in the top 12% of all industries, numbering over 250.
The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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