STMicroelectronics N.V. (STM) Stock Analysis & Winston Score

STMicroelectronics makes the tiny chips that go inside everyday electronics and machines. Its main products include microcontrollers, power management chips, and sensors used in cars, factory equipment, smartphones, and home appliances. The company is one of the largest chipmakers in Europe and supplies major customers like Apple, Tesla, and hundreds of industrial manufacturers.

STMicroelectronics earns money by designing and selling semiconductors directly to device makers, operating its own factories in Europe and Asia. It generates roughly $13–14 billion in annual revenue and competes globally against companies like Infineon, Renesas, and Texas Instruments. The company has built a strong position in automotive chips, particularly silicon carbide power semiconductors used in electric vehicles, which is its key growth driver — though a recent slowdown in EV adoption and weak industrial demand has pressured sales and squeezed margins, as reflected in its low operating and return figures today.

Winston Score History

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+22.8% YoY

YoY Growth Rate

Steady revenue growth

EPS Growth

-33.3% YoY

YoY Growth Rate

Earnings declining

R&D Spend

$2.1B/ year

→ Flat (-1% vs prior year)

17.3% of revenue

In line with sector average (15%)

Steady R&D investment year-over-year

Insider Activity

0.0%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$4.7B cash & investments

Quarterly Free Cash Flow

↓ Burn rate worsening

Company generates more cash than it spends — no dilution risk from fundraising

Growth + cash flow

STMicroelectronics N.V. is a rare growth stock that's already generating positive cash flow while growing at 23%. The Winston Score doesn't fully credit this transition from "burner" to "earner."

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Share count broadly stable

−0.1% over 4y

The share count has stayed roughly flat over this period — little dilution or buyback activity.

Diluted shares outstanding: 923.8M (2021) → 923.1M (2025)

Score breakdown

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Quality

Gross Margin

33.8%

Modest — 33.8% gross margin

Operating Margin

3.1%

Thin — 3.1% operating margin

ROCE

0.5%

Weak — 0.5% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+0.6%

Nearly flat sales (0.6% YoY)

EPS YoY

-86.9%

Earnings shrinking (-86.9% YoY)

Earnings per share down more than 10%. Either a bad year, or a real decline.

EPS Consistency

0/8 quarters

Earnings rarely grow — volatile business

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Cash Flow

Cash Conversion

1460%

Turns 1460% of profit into real cash

FCF Margin

0.6%

Thin free cash flow (0.6%)

FCF margin between 0% and 10%. Some cash from sales, but not a lot.

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Stability

Debt / Equity

0.14

Conservative — low debt load (0.14)

Interest Cover

8.10x

Comfortably covers interest (8.1x)

Interest coverage above 8. Profits cover interest many times over.

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Valuation

P/E Ratio (TTM)

387.9x

Expensive — P/E 387.9

P/E over 35. The market is pricing in heavy, sustained growth.

P/E vs Forward

+369.9

GROWING

Earnings expected to grow meaningfully — cheaper on forward P/E (387.9 → 18.0)

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Dividends

Dividend Yield

0.49%

Small dividend — 0.49% yield

Modest yield. The bulk of any return needs to come from price appreciation.

Dividend Growth

+0.0%

Dividend flat

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