Stem (NYSE:STEM) Announces Earnings Results

Stem (NYSE:STEM) posted its quarterly earnings results on Wednesday. The company reported ($1.58) earnings per share for the quarter, topping the consensus estimate of ($1.75) by $0.17, Zacks reports. The firm had revenue of $33.65 million for the quarter, compared to the consensus estimate of $36.65 million.

Here are the key takeaways from Stem’s conference call:

• Profitability and cash flow improved significantly: Q2 adjusted EBITDA rose 63% year over year to $6 million, marking the fifth consecutive positive quarter, while operating cash flow reached breakeven at $0.3 million.
• The software-centric mix continued to strengthen results, with record non-GAAP gross margin of 55%, PowerTrack software revenue up 11% year over year, and edge hardware revenue up 22%.
• Commercial momentum accelerated, as bookings increased 39% sequentially to $37 million, backlog rose 18% to $27 million, and PowerTrack ARR grew 3% sequentially to $42.8 million.
• PowerTrack EMS expanded internationally through projects in Chile and Hungary and now has bookings across six countries and three continents, supporting management’s focus on utility-scale growth in 2027 and beyond.
• Total Q2 revenue declined 12% year over year to $34 million because battery hardware resale revenue fell to $0.3 million from $5 million; management expects more low-margin battery resale revenue in the second half, which should reduce gross-margin percentages.

Stem Stock Performance

STEM stock opened at $6.37 on Friday. The firm has a market cap of $57.09 million, a PE ratio of -0.75 and a beta of 1.50. The firm has a fifty day moving average price of $6.77 and a 200 day moving average price of $9.38. Stem has a fifty-two week low of $4.92 and a fifty-two week high of $32.23.

Institutional Investors Weigh In On Stem

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. AQR Capital Management LLC lifted its position in Stem by 505.8% in the first quarter. AQR Capital Management LLC now owns 1,482,790 shares of the company’s stock worth $519,000 after buying an additional 1,238,012 shares during the last quarter. Bank of America Corp DE boosted its holdings in Stem by 104.0% during the 3rd quarter. Bank of America Corp DE now owns 217,871 shares of the company’s stock valued at $3,817,000 after acquiring an additional 111,068 shares during the period. Two Sigma Investments LP grew its position in Stem by 461.9% in the 3rd quarter. Two Sigma Investments LP now owns 94,045 shares of the company’s stock valued at $1,648,000 after acquiring an additional 77,307 shares during the last quarter. Bridgeway Capital Management LLC grew its position in Stem by 346.2% in the 4th quarter. Bridgeway Capital Management LLC now owns 69,600 shares of the company’s stock valued at $1,047,000 after acquiring an additional 54,000 shares during the last quarter. Finally, Jump Financial LLC purchased a new position in Stem in the 4th quarter worth about $534,000. 61.63% of the stock is currently owned by hedge funds and other institutional investors.

Analyst Ratings Changes

Several research firms recently commented on STEM. Susquehanna cut their price objective on shares of Stem from $10.00 to $7.50 and set a “neutral” rating for the company in a report on Friday, July 10th. New Street Research set a $8.00 price objective on shares of Stem in a research report on Monday, July 27th. Wall Street Zen cut shares of Stem from a “sell” rating to a “strong sell” rating in a report on Saturday, May 9th. Roth Capital reissued a “neutral” rating and issued a $11.00 target price on shares of Stem in a research report on Thursday, May 7th. Finally, Barclays cut their price objective on shares of Stem from $18.00 to $8.00 and set an “equal weight” rating for the company in a research report on Monday, July 27th. Four analysts have rated the stock with a Hold rating and one has assigned a Sell rating to the company. According to MarketBeat, Stem presently has a consensus rating of “Reduce” and a consensus price target of $9.00.

Stem Company Profile

Stem, Inc is a technology company specializing in AI-driven energy storage and optimization solutions for commercial, industrial and utility customers. The company delivers integrated hardware and software systems that enable clients to manage energy consumption, reduce peak demand charges and provide ancillary services to the power grid. By combining battery storage hardware with advanced machine-learning algorithms, Stem helps organizations align energy usage with cost-saving opportunities while supporting grid reliability and renewable integration.

At the core of Stem’s offering is its Athena software platform, which uses real-time data and predictive analytics to forecast energy needs and automatically dispatch stored energy when it is most valuable.