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What's in the Cards for STMicroelectronics' (STM) Q4 Earnings?

STMicroelectronics N.V. STM is scheduled to report fourth-quarter 2022 results on Jan 26.

For the fourth quarter, the company expects net revenues of $4.4 billion at the mid-point. The Zacks Consensus Estimate for revenues is pegged at $4.4 billion, implying a 23.9% year-over-year rise.

The consensus mark for earnings is pegged at $1.13 per share, indicating growth of 37.8% from the year-ago reported figure. The metric has been unchanged over the past 30 days.

STM surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 13.38%.

STMicroelectronics N.V. Price and EPS Surprise

 

STMicroelectronics N.V. Price and EPS Surprise
STMicroelectronics N.V. Price and EPS Surprise

STMicroelectronics N.V. price-eps-surprise | STMicroelectronics N.V. Quote

Factors to Consider

Solid demand for the company’s robust microcontrollers, sensors, power, analog and other connectivity products is likely to have driven its top-line growth in the industrial market in the quarter under review.

Increasing demand in the automotive product group across all geographies is likely to have aided STM’s performance in the to-be-reported quarter. Growing electrification and digitalization of the automotive industry are expected to have been a tailwind. Strong design wins in the company’s automotive sensor business are anticipated to have been positives. Solid design wins with ST power modules in electronic vehicle applications are likely to have driven its growth in the automotive market in the to-be-reported quarter.

Rising demand for STMicroelectronics’ robust microcontrollers, sensors, power, analog and other connectivity products is likely to have boosted its top line in the industrial market in the quarter under review.

The growing uptake of motion and environmental sensors, time-of-flight ranging sensors, wireless charging products, touch display controllers and secure solutions in smartphones is anticipated to have aided its performance in the personal electronics market in the fourth quarter. The strong momentum in design wins of smartwatches and other wearables is likely to have been another positive.

Strengthening customer engagements in cellular and satellite communication infrastructure are expected to have aided STM’s performance in the communications equipment, computer and peripherals markets in the quarter under review.

All the above-mentioned factors are anticipated to have impacted the overall fourth-quarter performance of the company.

However, the coronavirus-induced supply-chain disruptions in the semiconductor market are expected to have negatively impacted STMicroelectronics’ quarterly performance. Mounting expenses are likely to have been other headwinds in the quarter under discussion. Further, growing geo-political tensions are anticipated to have impacted the company's performance negatively.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for STMicroelectronics this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

STMicroelectronics has an Earnings ESP of -0.22% and a Zacks Rank #4 (Sell).

Stocks to Consider

Here are some stocks that you may consider, as our model shows that they have the right combination of elements to beat on earnings this season.

MSCI MSCI has an Earnings ESP of +0.43% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

MSCI is scheduled to release fourth-quarter 2022 results on Jan 31. The Zacks Consensus Estimate for MSCI’s earnings is pegged at $2.71 per share, suggesting an increase of 7.97% from the prior-year quarter’s reported figure.

Endava DAVA has an Earnings ESP of +1.97% and a Zacks Rank #3 at present.

Endava is set to report second-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for DAVA’s earnings is pegged at 68 cents per share, suggesting an increase of 7.94% from the prior-year period’s reported figure.

Analog Devices ADI has an Earnings ESP of +2.99% and a Zacks Rank #3 at present.

Analog Devices is scheduled to release first-quarter fiscal 2023 results on Feb 15. The Zacks Consensus Estimate for ADI’s earnings is pegged at $2.59 per share, suggesting an increase of 33.5% from the prior-year quarter’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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