STEM Overview

Price Target Update: The average one-year price target for Stem (NYSE:STEM) has been revised to $19.55 per share, reflecting a 30.68% increase from the previous estimate of $14.96, with current targets ranging from $17.17 to $24.15.

Fund Sentiment: There are 120 funds reporting positions in Stem, marking a 55.84% increase in ownership over the last quarter, with total shares owned by institutions rising by 32.64% to 2,087K shares.

Bullish Outlook: The put/call ratio for Stem is at 0.17, indicating a bullish sentiment among investors.

Shareholder Activity: Notable increases in share ownership have been reported by firms such as Marshall Wace, Bank of America, and Two Sigma Investments, with significant percentage increases in their portfolio allocations to Stem over the last quarter.

UBS Coverage and Price Forecast: UBS has maintained a Neutral recommendation for Stem (NYSE:STEM) as of October 31, 2025, with an average one-year price target of $14.96/share, indicating an 11.69% downside from its latest closing price of $16.94/share.

Projected Revenue and EPS: Stem's projected annual revenue is expected to reach $1,203 million, reflecting a significant increase of 629.32%, while the projected annual non-GAAP EPS is -0.17.

Fund Sentiment and Ownership: There has been a notable increase in institutional interest in Stem, with 113 funds reporting positions, a 653.33% increase in ownership over the last quarter, and total shares owned by institutions rising by 39,583.27% to 1,724K shares.

Shareholder Holdings: Key shareholders include Vanguard Total Stock Market Index Fund (2.90% ownership), Vanguard Extended Market Index Fund (1.48%), Bank of America (1.27%), Susquehanna International Group (1.20%), and Geode Capital Management (1.02%).

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Management Overview: CEO Arun Narayanan highlighted a successful transformation for Stem, Inc. in Q3 2025, reporting $38 million in revenue and a 17% year-over-year increase in annual recurring revenue (ARR) to $60 million, alongside positive adjusted EBITDA and operating cash flow for the second consecutive quarter.

Product Developments: The company unified its offerings under the PowerTrack suite, integrating solar and storage capabilities, and launched PowerTrack EMS for hybrid projects, achieving significant early bookings. An AI-powered assistant, PowerTrack Sage, is set for beta release in December.

Financial Guidance: Stem refined its 2025 revenue guidance to a range of $135 million to $160 million, with an emphasis on software and service performance, while raising gross margin expectations to 40%-50%. Adjusted EBITDA is forecasted to range from negative $5 million to positive $5 million.

Market Sentiment and Risks: Analysts expressed neutral to positive sentiments regarding new product launches and financial discipline, while management acknowledged challenges from policy uncertainty and macroeconomic conditions, particularly in the U.S., and continued to deemphasize the battery hardware resale business.

Earnings Performance: Vertiv Holdings Co. (VRT) reported quarterly earnings of $1.24 per share, exceeding the Zacks Consensus Estimate of $1 per share and showing a significant increase from $0.76 per share a year ago, marking a 24% earnings surprise.

Revenue Growth: The company achieved revenues of $2.68 billion for the quarter, surpassing expectations by 3.6% and reflecting a year-over-year increase from $2.07 billion, with consistent outperformance in revenue estimates over the last four quarters.

Stock Outlook: Vertiv shares have risen approximately 53.9% year-to-date, significantly outperforming the S&P 500's 14.5% gain, but the stock currently holds a Zacks Rank #3 (Hold), indicating expected performance in line with the market.

Industry Context: The Computers - IT Services industry, to which Vertiv belongs, is ranked in the top 19% of Zacks industries, suggesting a favorable environment for stock performance, while investors are advised to monitor earnings estimate revisions for future guidance.

Strategic Realignment and Brand Unification: Stem, Inc. has successfully completed a year of strategic realignment, unifying its brand and product offerings under the PowerTrack™ Suite to enhance customer value and operational efficiency.

Launch of PowerTrack Products: The company introduced the PowerTrack Energy Management System (EMS) and rebranded its Athena platform as PowerTrack Optimizer, both aimed at improving energy management and maximizing revenue for customers in the clean energy sector.

Showcasing Innovations at RE+ 2025: Stem is participating in the RE+ 2025 event to demonstrate its integrated solutions and engage with stakeholders, highlighting its commitment to simplifying the clean energy landscape.

Commitment to Sustainable Growth: The CEO emphasized the company's focus on software-driven solutions and its mission to drive the energy transition, positioning Stem for continued growth and value creation in the evolving energy market.