BofA warns Fed risks policy mistake with early rate cuts
Investing.com - UBS raised its price target on Stem Inc. (NYSE:STEM) to $16.00 from $8.60 while maintaining a Neutral rating on the clean energy company. The stock has shown strong momentum, gaining over 35% in the past six months, though it remains significantly below its 52-week high of $33.60.
The significant price target increase reflects Stem’s progress in pivoting toward a higher-margin services business and away from hardware sales, according to UBS.
The firm also cited a "broadly better-than-market-expected U.S. clean energy policy environment" as a factor in its revised valuation.
UBS expects Stem to continue building a higher proportion of revenue and profit from recurring long-dated service contracts, which require less balance sheet funding and provide more predictable earnings compared to volatile hardware sales.
Stem implemented a 20-for-1 reverse stock split effective June 23, 2025, and UBS notes that the company’s relatively small size and high-risk profile "may not be suitable for all investors."
In other recent news, Stem Inc. reported a notable financial performance for the second quarter of 2025, with a 13% increase in total revenue, bringing the figure to $38.4 million. This performance exceeded expectations and highlighted significant growth in high-margin software revenue. In response to these results, Roth/MKM adjusted its price target for Stem Inc. to $13.00 from a previous $7.00, while maintaining a Neutral rating. The analysts at Roth/MKM attributed this revision to the company’s impressive software growth. These developments reflect a positive outlook from investors and analysts alike, focusing on Stem’s strategic initiatives and financial health.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.