St is on a roll, buoyed by BofA’s promotion
The bank has upgraded its recommendation on the share from "Neutral" to "Buy" and raised its target price from €71 to €86. This is the highest target price among those set by analysts
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(Il Sole 24 Ore Radiocor) - Stmicroelectronics is trading on FTSE MIB following the upgrade from Bank of America. The US investment bank has upgraded its recommendation on the stock from "Neutral" to "Buy" and has simultaneously raised the target price from €71 to €86. This is the highest target currently indicated by analysts covering the group.
“We expect STMicroelectronics to benefit from a number of favourable factors, including a growing market share in the optical interconnect sector, the development of low-Earth orbit satellites (LEO), the recovery of the automotive and industrial sectors, rising chip prices and significant operating leverage stemming from the large amount of currently unused production capacity,” explained Bank of America analysts. According to the experts, the market is significantly underestimating the company’s growth potential; over the next two to three years, it could see a sharp rise in profits, partly due to the expected exponential growth in data centres, which guarantee the group high margins.
“We forecast earnings per share of $1.57 in 2026, $3.53 in 2027 and $4.63 in 2028, which are 30–43% higher than the consensus
“or analysts”, the report states.
