Please ensure Javascript is enabled for purposes of website accessibility

Why STMicroelectronics Shares Jumped Today

By Evan Niu, CFA - Updated May 23, 2017 at 1:31PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

STMicroelectronics sees the industry recovering after a few rough quarters.

A graphic showing device connections and capabilities

Image source: STMicroelectronics.

Get the latest STMicroelectronics stock news and facts.

What

Shares of STMicroelectronics (STM 0.63%) have jumped on Wednesday after the company reported first-quarter earnings.

So what

Revenue in the first quarter came in at $1.61 billion, which was a little light compared to the $1.63 billion in sales that analysts were expecting. The company posted an adjusted net loss of $0.02 per share, which was also slightly worse than expected. Gross margin was 33.4%, up a modest 20 basis points from a year ago.

Now what

The good news was guidance. CEO Carlo Bozotti acknowledged that the past few quarters have been soft, but there are now visible signs that the industry is recovering. Bookings are up in many geographic regions and sectors like automotive and industrial are showing increased booking activity. Sales should rise sequentially by about 5.5% and gross margin should expand to 34%.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

STMicroelectronics N.V. Stock Quote
STMicroelectronics N.V.
STM
$38.49 (0.63%) $0.24

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
322%
 
S&P 500 Returns
116%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.