STMicroelectronics: 2Q26 First Take: Despite beat, results are a mixed bag

研报英文原文证据摘录

STMicroelectronics: 2Q26 First Take: Despite beat, results are a mixed bag

Sandeep Deshpande AC Europe Equity Research

(44-20) 7134-5276 23 July 2026 J P M O R G A N

sandeep.s.deshpande@jpmorgan.com

Investment Thesis, Valuation and Risks

STMicroelectronics (Neutral; Price Target: €71.50)

Investment Thesis

STMicro has had a strong run in 2026. The reasons for the move include market expectations

that the semis cycle has 'turned', particularly in industrial semis to which STMicro is

significantly exposed; STMicro’s deal with AWS got STMicro the AI exposure the

company lacked and had held back the stock (both power and optical exposure); and finally

STMicro has exposure to the LEO satellite companies and that is also a strong growth

market. That STMicro will see strong revenue growth when the cycle turns was never under

question. Less certain, however, is how significantly the company’s gross margin will

improve. The extent of gross margin improvement will be the key flex on EPS. With our

estimates already forecasting 2028 gross margin that is ~860 bps higher than 2025, we

believe investors will need to see evidence of more significant scaling of the gross margin

to turn substantially more bullish – hence our continuing Neutral rating.

Valuation

STMicroelectronics has traded between 13.1x and 22.0x (inter-quartile range) in the past 10

years with an average/median multiple of 18.2x/18.6x. Given ST’s exposure to structurally

growing markets (optical connectivity inside data centers and LEO satellites), the company

should be trading at a premium to its historical average. Thus, we value the stock based on

a 20x forward P/E on our ‘28 EPS estimates which implies a Dec-27 price target of $81.5

which translates to €71.5 at the current EURUSD spot rate.