Jefferies analyst Lee Simpson this morning launched coverage of STMicroelectronics (STM) with a Buy rating and a target price of $9.50 on the company’s ADRs.
“We believe STMicro is one of only a few global semi players with the scale and necessary platform strategy to survive the upheaval ahead,” including consolidation, more intense Asian competition and intense price pressure. He contends that the chip maker is a “forgotten prize,” trading at 0.5x EV/sales, and 2-3x EV/EBITDA.
STM this morning is up 29 cents, or 3.7%, to $8.12.
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