As of April 24, 2026, STMicroelectronics NV's estimated intrinsic value ranges from $9.56 to $17.68 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $15.98 | -62.7% |
| Discounted Cash Flow (5Y) | $17.68 | -58.8% |
| Dividend Discount Model (Multi-Stage) | $15.60 | -63.6% |
| Dividend Discount Model (Stable) | $9.56 | -77.7% |
| Earnings Power Value | $12.08 | -71.8% |
Is STMicroelectronics NV (STMPA.PA) undervalued or overvalued?
With the current market price at $42.87, the stock appears to be significantly overvalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate STMicroelectronics NV's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 3.0% | 3.5% |
| Equity market risk premium | 5.8% | 6.8% |
| Adjusted beta | 1.16 | 1.29 |
| Cost of equity | 9.8% | 12.8% |
| Cost of debt | 4.0% | 4.5% |
| Tax rate | 12.1% | 12.9% |
| Debt/Equity ratio | 0.1 | 0.1 |
| After-tax WACC | 9.2% | 11.9% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $20 | $19,807M | 64.5% |
| 10-Year Growth | $18 | $18,017M | 41.9% |
| 5-Year EBITDA | $57 | $52,811M | 86.7% |
| 10-Year EBITDA | $47 | $44,485M | 76.5% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $1,446M |
| Discount Rate (WACC) | 11.9% - 9.2% |
| Enterprise Value | $12,110M - $15,749M |
| Net Debt | $1,249M |
| Equity Value | $10,861M - $14,500M |
| Outstanding Shares | 911M |
| Fair Value | $12 - $16 |
| Selected Fair Value | $12.08 |
| Metric | Value |
|---|---|
| Market Capitalization | $39067M |
| Enterprise Value | $40151M |
| Trailing P/E | 49.61 |
| Forward P/E | 28.31 |
| Trailing EV/EBITDA | 15.30 |
| Current Dividend Yield | 104.82% |
| Dividend Growth Rate (5Y) | 14.42% |
| Debt-to-Equity Ratio | 0.10 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $4.79 |
| Discounted Cash Flow (5Y) | 25% | $4.42 |
| Dividend Discount Model (Multi-Stage) | 20% | $3.12 |
| Dividend Discount Model (Stable) | 15% | $1.43 |
| Earnings Power Value | 10% | $1.21 |
| Weighted Average | 100% | $14.98 |
Based on our comprehensive valuation analysis, STMicroelectronics NV's intrinsic value is $14.98, which is approximately 65.1% below the current market price of $42.87.
Key investment considerations:
Given these factors, we believe STMicroelectronics NV is currently significantly overvalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.