STMicroelectronics the laggard of the CAC 40, under pressure after its rally

The stock loses ground and falls below its 20-day moving average

STMicroelectronics shares fell by 2.57% to €63.39, making it the laggard of the CAC 40 as the index itself dropped by 0.37%. The stock has fallen below its 20-day moving average (€64.55), a short-term signal that contrasts with the underlying momentum's strength. The price still maintains a 17.5% lead over its MM50 and remains nearly 99% above its MM200, evidence of the spectacular rally that began in the spring.

Over three months, the stock is still up +120.5%, despite a weekly decline of 6.63%. The RSI at 54 has returned to a neutral zone, after having been in an overbought territory for several weeks. European peers are also retreating, with ASM International down 3.21% and ASML by 0.98%.

A consolidation occurring after a 120% rally over three months

The session is part of a profit-taking movement that has regularly shaken the stock since the beginning of June, after a market performance that saw it more than double in three months. The sector context remains supportive: the launch on June 24 of the ST54M, a post-quantum secure chip for smartphones, enriched the group's offerings just days after the VL53L9 Lidar module aimed at embedded AI. In early June, the group also raised its ambition for its data center activities, now targeting about $1 billion in revenue by 2026.

In terms of valuation, the stock is trading at about 56 times the expected earnings for the current fiscal year and 28.6 times those of the next year according to the consensus of surveyed analysts. The technical support at €52.15 remains the next low marker identified in the data.