Oddo BHF Welcomes Major Contract Between STMicro and AWS
Oddo BHF reiterates its "outperform" rating on STMicroelectronics and raises its price target from 32 to 34 euros following the announcement of the contract with Amazon Web Services (AWS), which it deems "obviously positive on two fronts."
"This represents a significant business opportunity, which should enable faster growth, but also allow margins to improve more quickly than consensus expectations," the analyst highlights.
"It should radically change investors' perception of the stock, as the company was previously seen as only exposed to the automotive sector, industry, and Apple, and not at all to AI, unlike Infineon," he adds.
The research firm slightly raises its 2026 forecasts by +1.8% and by a bit more to +8% for 2027, as it believes this contract will help the company more quickly return to the necessary revenue level of USD 4 billion per quarter, which should allow it to regain a gross margin of 40%.
With over 48,000 creators and makers of semiconductor technologies mastering the semiconductor supply chain in state-of-the-art manufacturing facilities, STMicroelectronics N.V. is an integrated device manufacturer, working with more than 200,000 customers and thousands of partners to design and build products, solutions, and ecosystems that address their challenges and opportunities, and the need to support a more sustainable world. The Group's technologies enable smarter mobility, more efficient power and energy management, and the wide-scale deployment of cloud-connected autonomous things.
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