STMicroelectronics NV, the Technology sector company, was revisited by a Wall Street analyst today. Analyst Lee Simpson from Morgan Stanley maintained a Hold rating on the stock and has a €26.00 price target.
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Lee Simpson has given his Hold rating due to a combination of factors impacting STMicroelectronics NV. Although the company has experienced strong sales in personal electronics, particularly driven by increased Apple imaging content and growth in industrial microcontrollers, the overall margins have not shown significant recovery. This is attributed to ongoing challenges such as idle charges, currency fluctuations, and lower reservation fees, which continue to impede a robust rebound.
Furthermore, the power discretes segment remains a weak spot, with a notable year-over-year decline and a negative operating margin in the third quarter. While there is some recovery in the automotive and industrial sectors, the progression into the fourth quarter is expected to be below seasonal norms. The company’s restructuring efforts and reduced capital expenditure plans also play a role in the cautious outlook, leading to the Hold rating by Lee Simpson.
Simpson covers the Technology sector, focusing on stocks such as Cadence Design, Synopsys, and ARM Holdings PLC ADR. According to TipRanks, Simpson has an average return of 3.6% and a 52.50% success rate on recommended stocks.
In another report released on October 19, TR | OpenAI – 4o also reiterated a Hold rating on the stock with a €27.00 price target.