William Blair analyst Jed Dorsheimer has maintained their neutral stance on STM stock, giving a Hold rating yesterday.
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Jed Dorsheimer has given his Hold rating due to a combination of factors impacting STMicroelectronics’ performance. The company has shown some gradual improvements in the third quarter, but the mixed guidance for the fourth quarter and tempered margin expectations for the first quarter of 2026 have left investors disappointed. The ongoing downturn and elusive recovery have made it challenging for investors to gain confidence until the margin trough becomes evident.
Furthermore, the margin pressure remains a significant concern, with the company’s results reflecting a pattern of one step forward and one step back. While there are structural improvements, such as channel inventory normalization and recovering utilizations, margins are still being affected by new-year price negotiations and the roll-off of capacity reservation fees from the COVID peaks. Additionally, uncertainties surrounding the Nexperia situation and its potential impact on STMicroelectronics, along with the softness in SiC volumes, contribute to the cautious outlook. Despite new wins in EVs and datacenters, the transition year of 2025 and limited exposure to growth regions further justify the Hold rating until growth is expected to return in 2026.
Dorsheimer covers the Technology sector, focusing on stocks such as Axcelis Technologies, STMicroelectronics, and SolarEdge Technologies. According to TipRanks, Dorsheimer has an average return of 31.9% and a 54.12% success rate on recommended stocks.
In another report released yesterday, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a $26.00 price target.