Stem Inc (STEM) AI Stock Analysis

• Market Cap: $183.66M
• Dividend Yield: N/A
• Average Volume (3M): 222.54K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.38
• Revenue Growth: -35.61%
• EPS Growth: N/A
• Country: US
• Employees: 569
• Sector: Utilities
• Sector Strength: 65
• Industry: Software - Infrastructure
• EPS (TTM): -2.84
• Shares Outstanding: 8,390,208
• 10 Day Avg. Volume: 190,002
• 30 Day Avg. Volume: 222,540
• PEG Ratio: >-0.01
• Price to Book (P/B): -0.24
• Price to Sales (P/S): 0.67
• P/FCF Ratio: -2.01
• Enterprise Value/Market Cap: 2.57
• Enterprise Value/Revenue: 2.86
• Enterprise Value/Gross Profit: 13.66
• Enterprise Value/Ebitda: 3.01
• 1Y Price Target: $19.60
• Price Target Upside: 1.92% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 5
• EPS Forecast (FY): -4.32
• Revenue Forecast (FY): $149.22M

• Rating: 54 Neutral
• Price Target: $22.50 ▲(17.00% Upside)

Stem Inc's overall stock score reflects significant financial challenges, with high leverage and liquidity risks being major concerns. Despite positive earnings call highlights and technical momentum, the negative valuation metrics and potential margin compression weigh heavily on the score.

Positive Factors

Revenue Growth

Strong revenue growth indicates increasing demand for Stem's products and services, reflecting successful market penetration and customer adoption.

Software-Centric Strategy

The shift to a software-centric model enhances profitability and recurring revenue, providing a more stable and scalable business foundation.

Leadership and Governance

Strengthening leadership with CEO's board appointment supports strategic execution and governance, aligning management with shareholder interests.

Negative Factors

High Leverage

High leverage and negative equity indicate financial instability, which can limit growth opportunities and increase risk during economic downturns.

Cash Flow Challenges

Weak cash flow management poses liquidity risks, potentially hindering the company's ability to invest in growth and meet financial obligations.

Potential Margin Compression

Margin compression due to sales mix shifts could pressure profitability, impacting long-term financial performance and strategic flexibility.

Stem Inc Business Overview & Revenue Model

Company Description

Stem, Inc. operates as a digitally connected and intelligent energy storage network provider in the United States and internationally. It offers energy storage systems sourced from original equipment manufacturers (OEMs). The company also provides Athena, an artificial intelligence platform, which offers battery hardware and software-enabled services to operate the energy storage systems. In addition, it offers system design and engineering services, supply chain management, energy storage value stream optimization, warranty and preventive maintenance plan management, operation and maintenance reporting, and program enrollment and incentive management services. The company serves commercial and industrial enterprises, independent power producers, renewable project developers, and utilities and grid operators. Stem, Inc. was incorporated in 2009 and is headquartered in San Francisco, California.

How the Company Makes Money

Stem Inc generates revenue primarily through the sale and installation of energy storage systems, which are marketed to businesses looking to optimize their energy consumption and reduce costs. The company also benefits from software licensing fees for its AI-driven energy management platform, which provides customers with insights and analytics to manage their energy usage effectively. Additional revenue streams include maintenance and support services for installed systems, as well as potential participation in energy markets where they can provide ancillary services like demand response. Significant partnerships with renewable energy developers and utilities enhance their market reach and facilitate project financing, contributing to their overall earnings.

Stem Inc Financial Statement Overview

Summary

Stem Inc's financial statements reveal significant challenges, including negative equity and cash flows, indicating financial instability and liquidity risks. Despite some profitability in the income statement, historical volatility and high leverage are concerning.

Income Statement

Stem Inc shows a mixed performance in its income statement. The TTM data reveals a positive net profit margin of 62.20%, indicating profitability, but this is overshadowed by a negative EBIT margin of -84.71%. Revenue growth is positive at 5.74% TTM, showing some recovery from previous declines. However, historical data indicates volatility with significant losses in prior years, suggesting instability in revenue and profitability.

Balance Sheet

The balance sheet presents a challenging picture with a negative stockholders' equity, leading to a negative debt-to-equity ratio of -1.37 TTM. This indicates financial instability and high leverage. The return on equity is also negative, reflecting poor profitability relative to shareholder investment. The equity ratio is not available due to negative equity, further highlighting financial distress.

Cash Flow

Cash flow analysis shows a concerning trend with negative operating and free cash flows TTM. The free cash flow growth rate is -55.3%, indicating declining cash generation. However, the free cash flow to net income ratio is positive at 1.10, suggesting some efficiency in converting net income to cash. Overall, cash flow management appears weak, with potential liquidity risks.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	164.95M	144.58M	461.51M	362.98M	127.37M	36.31M
Gross Profit	34.48M	-11.06M	3.67M	33.09M	1.25M	-3.91M
EBITDA	156.59M	-790.40M	-79.17M	-87.68M	-62.99M	-116.99M
Net Income	102.60M	-854.01M	-140.41M	-124.05M	-101.21M	-156.12M
Balance Sheet
Total Assets	362.61M	437.36M	1.36B	1.42B	1.19B	205.85M
Cash, Cash Equivalents and Short-Term Investments	43.12M	56.30M	113.59M	249.98M	920.79M	6.94M
Total Debt	321.65M	542.02M	537.04M	463.05M	346.93M	106.28M
Total Liabilities	597.72M	835.19M	930.30M	869.73M	524.00M	383.26M
Stockholders Equity	-235.11M	-398.37M	426.20M	551.63M	667.83M	-177.41M
Cash Flow
Free Cash Flow	-19.79M	-48.42M	-225.61M	-110.13M	-111.44M	-45.71M
Operating Cash Flow	-16.07M	-36.65M	-207.38M	-106.03M	-101.27M	-33.67M
Investing Cash Flow	-8.35M	-3.52M	135.73M	-543.83M	-185.23M	-12.04M
Financing Cash Flow	-7.58M	-8.44M	90.24M	-9.81M	1.03B	40.29M

Stem Inc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 19.23
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STEM, the sentiment is Positive. The current price of 19.23 is above the 20-day moving average (MA) of 17.06, below the 50-day MA of 19.78, and above the 200-day MA of 13.38, indicating a neutral trend. The MACD of 0.28 indicates Negative momentum. The RSI at 53.56 is Neutral, neither overbought nor oversold. The STOCH value of 74.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STEM.

Stem Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENS	77 Outperform	$5.58B	17.67	18.22%	0.69%	6.17%	20.86%
Sector *	66 Neutral	$17.65B	18.10	5.60%	3.62%	6.62%	11.55%
ENPH	61 Neutral	$4.32B	22.27	20.31%	―	20.97%	226.98%
FLNC	55 Neutral	$4.72B	―	-10.72%	―	-16.15%	-324.40%
STEM	54 Neutral	$183.66M	―	―	―	-35.61%	―
ZENA	45 Neutral	$106.06M	―	-100.32%	―	312.20%	―

Stem Inc Corporate Events

Stem Inc Expands Board, Appoints CEO as Director

On December 1, 2025, Stem Inc. expanded its Board of Directors from seven to eight members and appointed its CEO, Arun Narayanan, as a Class I Director. This strategic move, recommended by the Nominating, Governance and Sustainability Committee, aims to strengthen the company’s leadership without additional compensation for Mr. Narayanan, indicating a focus on governance and sustainability.

Stem Inc Issues Press Release with Form 8-K

On October 29, 2025, Stem Inc issued a press release, which was furnished with Form 8-K. The information provided in the release will not be considered ‘filed’ for purposes of Section 18 of the Exchange Act, nor will it be incorporated by reference into any filing under the Securities Act unless specifically referenced.

Stem Inc Reduces Quorum Requirement for Meetings

On October 15, 2025, Stem, Inc. amended its bylaws to reduce the quorum required for stockholder meetings from a majority to one-third of voting power. This change addresses past difficulties in reaching a quorum due to the dispersed nature of its stockholder base, aiming to prevent additional costs and disruptions from adjourned meetings.