STM Stock Edges Higher Premarket After Post-Earnings Plunge: Analyst Touts Attractive Valuation, Retail Turns Uber-Bullish

• Baird’s Tristan Gerra also added a “Fresh Pick” designation to the stock, reasoning that the valuation is attractive.
• The analyst sees the company benefiting from easier revenue and gross margin comparisons throughout 2026.
• STM stock has gained just 2% year-to-date (YTD), underperforming the broader market, the tech sector, and the semiconductor industry.

Shares of Netherlands-based chipmaker STMicroelectronics N.V. (STM) were among the top five trending equity tickers on Stocktwits early Friday as retail investors warmed to the stock following Thursday’s earnings-induced slump of over 13%.

Traders, however, remained cautious as the STMicroelectronics stock was marginally higher in the early premarket session on Friday. An analyst, however, issued an upbeat commentary regarding the stock, stating that the worst may be behind.

Baird Designates STM Among Fresh Picks

In a note released late Thursday, Baird analyst Tristan Gerra reiterated an ‘Outperform’ rating on STM stock but reduced the price target to $45 from $50. “At current levels, stock embeds all the grief regarding the 1Q GM reset, positioning investors well for an ongoing revenue and gross margin recovery each following quarter throughout 2026,” the analyst said.

Gerra also added a “Fresh Pick” designation to the stock, reasoning that the valuation is attractive, as the stock trades at a five-year trough price-earnings (P/E) ratio of 8x. The analyst sees the company benefiting from easier revenue and gross margin comparisons throughout 2026.

Thursday’s stock plunge came despite the company’s third-quarter double-beat, as investors fretted about its gross margin, which was below its long-term targets. The company also issued a sub-par full-year revenue outlook.

What Is Retail Feeling About STM Stock?

Stocktwits users turned ‘extremely bullish’ on STM stock early Friday, improving from the ‘neutral’ sentiment seen a day ago. The message volume also surged to ‘extremely high’ levels.

A bullish user states that the positive fourth-quarter outlook is ‘huge’ for the stock.

Another user included the stock in their watchlist for Friday. “Very strong European chip company, outstanding numbers, strong revenue, and strong profit, but the share price crashed by 13%,” they said.

STM stock has gained just 2% year-to-date (YTD), underperforming the broader market, the tech sector, and the semiconductor industry.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: Super Micro Stock Rises Premarket As Analyst Points To Strong Orders: Retail Traders Look To Capitalize On Thursday Dip

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