This semiconductor company beat analysts’ estimates by $0.02 last quarter, and is forecast to grow at a triple-digit rate this year and next.
STMicroelectronics (STM)
From Blue Chip Growth
We’ve had a lot of success with our existing chipmakers on the Buy List—including Applied Materials Inc. (AMAT), Broadcom Ltd. (AVGO) and NVIDIA Corp. (NVDA). This month, we’re adding another premium semiconductor play that has plenty of upside potential.
Based in Geneva, Switzerland, STMicroelectronics (STM) designs, manufactures and sells chips that power everything from self-driving cars to high efficiency electronics to smart consumer devices. ST has an impressive global footprint, with 43,500 employees, 11 manufacturing sites and over 75 sales and marketing offices in 35 countries. ST also owns upwards of 16,000 patents, with new patents being filed every day. The company sells its products through its distributors and retailers, as well as through sales representatives.
The stock has been rallying on the announcement that STMicroelectronics won a deal with an unnamed customer that can generate “substantial revenues” in the second half of 2017. Because the iPhone 8 is anticipated to be released later this year, it is widely assumed that the “unnamed customer” is Apple.
For the first quarter, the analyst community is expecting STMicroelectronics to post 12.5% annual sales growth and a whopping 750% annual earnings growth. In the past three months, the analyst community has revised their consensus earnings estimate 14.3% higher. STM also has a 1.3% annual dividend yield. The stock will next go ex-dividend on March 17. Shareholders of record will receive $0.051 per share on March 28. In the meantime, I recommend that you add this Moderately Aggressive stock up to $16 per share.
Louis Navellier, Blue Chip Growth, www.bluechipgrowth.com, 800-718-8289, March 2017