Fitch Ratings raised STMicroelectronics N.V.'s long-term issuer default rating to BBB from BBB- with a stable outlook, citing the Swiss chip maker's competitive position in the semiconductor industry.

The rating agency said it expects ST to maintain its competitive position in a number of niche markets with the help of its large IP portfolio and significant research and development spending.

Fitch, however, noted that the unabated industry consolidation and formation of larger competitors may hurt ST's position.

The company should benefit from the semiconductor industry's positive short- and medium-term prospects, according to Fitch. The World Semiconductors Trade Statistics organization forecasts the world semiconductor market to grow by 15.7% this year and 5.2% in 2019, from 21.6% growth in 2017. The forecast is in line with ST's guidance to expand its year-over-year revenues by 14% to 17% this year.

"We expect ST to grow largely in line with its addressable markets in the long term, with the overall expansion benefiting from ST's exposure to growing segments such as the Internet of Things, industrial and automotive supported by increasing average silicon content per car," Fitch said.

The rating agency also cited the company's diversified product portfolio, significant customer concentration, funds for capacity expansion, profitability improvement, sustainably positive free cash flow generation, and low leverage.