Didier Scemama, an analyst from Bank of America Securities, reiterated the Hold rating on STMicroelectronics NV. The associated price target remains the same with €30.00.
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Didier Scemama has given his Hold rating due to a combination of factors impacting STMicroelectronics NV. The recent agreement between Mobileye and TSMC to manufacture components for future EyeQ products suggests that STMicroelectronics may no longer be the intermediary for some of these products, which could pose risks such as reduced utilization of their 300mm fab in Crolles and decreased exposure to the growing ADAS market. However, STMicroelectronics still maintains a partnership with Mobileye beyond manufacturing, which could support their long-term relationship.
Despite the potential risks, the immediate impact on STMicroelectronics is expected to be limited, as any transition to a new supplier by Mobileye would take time. Additionally, STMicroelectronics provides additional services like packaging, which strengthens their partnership with Mobileye. In the long term, there could be financial implications if the company cannot replace the business with other clients like Apple or SpaceX. These factors contribute to the Hold rating, as the current valuation reflects these uncertainties.
According to TipRanks, Scemama is an analyst with an average return of -2.6% and a 42.17% success rate. Scemama covers the Technology sector, focusing on stocks such as STMicroelectronics NV, ASML Holding NV, and Logitech.
In another report released on June 30, J.P. Morgan also maintained a Hold rating on the stock with a €30.00 price target.