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What's in Store for STMicroelectronics (STM) in Q1 Earnings?

STMicroelectronics STM is scheduled to report its first-quarter 2024 results on Apr 25.

For the first quarter, the company expects net revenues of $3.60 billion at the mid-point. The Zacks Consensus Estimate for revenues is pegged at $3.60 billion, implying a 15.2% year-over-year decline.

The consensus mark for earnings is pinned at 59 cents per share, indicating a decline of 46.4% from the year-ago reported figure.

STM surpassed the Zacks Consensus Estimate in three of the trailing four quarters while missing the same once, the average surprise being 8.9%.

Let’s see how things have shaped up for this announcement.

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

Growing demand in the automotive product group across all geographies, driven by increasing semiconductor pervasion and structural transformation, is likely to have aided STM’s performance in the first quarter of 2024.

Strong momentum in the car digitalization market, due to continued design wins with its latest generation of automotive microcontrollers, is likely to have been a tailwind for the company in the to-be-reported quarter.

Strength in embedded processing solutions, owing to its expanding STM32 portfolio, growing customer engagement for edge AI deployment and AI algorithm integration to existing microcontroller unit offerings, is likely to have boosted STM’s performance in the quarter under review.

Growing momentum across the computer peripherals and communication equipment markets is expected to have been another positive.

The company’s growing customer base for its power and energy, factory automation and robotics, and industrial infrastructure solutions are expected to have bolstered its performance in industrial end-market during the first quarter.

However, increasing inventory correction is expected to have impacted its prospects in the industrial end-market negatively in the quarter under discussion.

STM’s weakening momentum across the personal electronics market is expected to have been a concern.

The growing macroeconomic challenges and unfavorable seasonality are likely to have remained headwinds for the company in the first quarter.

What Our Model Says

The Zacks model predicts that 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. But that’s not the case here.

STMicroelectronics has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell) at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

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

APi Group APG has an Earnings ESP of +2.06% and a Zacks Rank #1 at present. You can see the complete list of today's Zacks #1 Rank stocks here.

APi Group is scheduled to release first-quarter 2024 results on May 2. The Zacks Consensus Estimate for APG’s earnings is pegged at 32 cents per share, indicating growth of 28% from the year-ago quarter’s reported figure.

Amazon AMZN has an Earnings ESP of +11.66% and a Zacks Rank #2 at present.

Amazon is set to announce first-quarter 2024 results on Apr 30. The Zacks Consensus Estimate for AMZN’s earnings is pinned at 82 cents per share, indicating a jump from the year-ago quarter’s reported figure of 31 cents per share.

Cardinal Health CAH has an Earnings ESP of +1.11% and a Zacks Rank #3 at present.

CAH is scheduled to release third-quarter fiscal 2024 results on May 2. The Zacks Consensus Estimate for CAH’s earnings is pegged at $1.95 per share, indicating growth of 12.1% from the year-ago quarter’s reported figure.

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

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