STMicroelectronics N.V. (STM) DCF Valuation
Why we don't show a single “fair value” for STM
A trailing-FCF DCF can't fairly anchor STMicroelectronics N.V. right now — free cash flow has been negative in recent years. For a company in this position, trailing free cash flow understates what the business actually earns for owners, so any “fair value” built on it would be misleadingly low. Off today's cash-flow base, no plausible growth rate bridges to the current price — the market is valuing normalized future cash flows, not the depressed base. The model scenarios below are shown for reference only.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 0.5%/yr | 12.5% | $8.28 |
| Base case | 2.4%/yr | 11.5% | $9.76 |
| Optimistic | 5.4%/yr | 10.5% | $12.17 |
Current Price
$78.39
Market-Implied Growth
—
Base-Case Model Value
$9.76
model output — not a price target
STM DCF Fair Value Calculator
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for STM (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $702.0M · 0.89B shares · net cash $704.0M
Estimated Fair Value
$9.73
-87.6% vs $78.39
Sensitivity — fair value by discount rate × terminal growth
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 2.4%/yr FCF growth and 10-year horizon fixed. Green = above today's $78.39; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 9.5% | $11.48 | $11.85 | $12.27 | $12.76 | $13.33 |
| 10.5% | $10.27 | $10.54 | $10.84 | $11.18 | $11.57 |
| 11.5% | $9.31 | $9.51 | $9.73 | $9.97 | $10.25 |
| 12.5% | $8.52 | $8.67 | $8.83 | $9.02 | $9.22 |
| 13.5% | $7.86 | $7.98 | $8.10 | $8.24 | $8.40 |
About STMicroelectronics N.V.
STMicroelectronics N.V., founded in 1987 and headquartered in Schiphol, Netherlands, is a prominent global semiconductor company. It engages in the entire product lifecycle, from designing and developing to manufacturing and selling semiconductor devices across Europe, the Middle East, Africa, the Americas, and the Asia Pacific region. The company operates through three principal divisions: 1. Automotive and Discrete Group: Specializes in integrated circuits for the automotive sector, along with discrete components and power transistors. 2. Analog, MEMS and Sensors Group: Offers a diverse range of products including industrial application-specific integrated circuits (ASICs) and application-specific standard products (ASSPs), general-purpose and custom analog ICs, wireless charging systems, galvanic isolated gate drivers, various amplifiers (low/high voltage, comparators, current-sense), the MasterGaN solution (integrating a silicon driver and GaN power transistors), wired and wireless connectivity ICs, touchscreen controllers, micro-electromechanical systems (MEMS) for sensing or actuation, and optical sensing technologies. 3. Microcontrollers and Digital ICs Group: Focuses on both general-purpose and secure microcontrollers, in addition to radio frequency (RF) products. Additionally, STMicroelectronics provides application-specific standard products for analog, digital, and mixed-signal applications, alongside assembly and other related services. Its offerings are distributed via distributors, retailers, and direct sales representatives, reaching key markets such as automotive, industrial, personal electronics, communications equipment, and computing devices.
- Sector
- Technology
- Industry
- Semiconductors
- CEO
- Jean-Marc Chery