Stem Inc. (STEM) PT Lowered to $4 at Susquehanna

Susquehanna analyst Biju Perincheril lowered the price target on Stem Inc. (NYSE: STEM) to $4.00 (from $5.50) while maintaining a Positive rating.

The analyst commented, "4Q'23 revenue missed guidance, causing EPS to fall below expectations. However, STEM achieved positive adjusted EBITDA and non-GAAP gross margins were inline with our forecast. FY'24 revenue guidance was softer than expected and was 10% below our prior estimate, though there could be some upside potential through timing of large FTM deals and accelerating the conversion of CARR to ARR. Lastly, the company signed 800MWh of software-only deals to start the year. We maintain our Positive rating but lower our price target to $4. 4Q revenue misses. 4Q'23 revenue of $167mm missed guidance, and was meaningfully below our forecast, due to project slippage caused by continued interconnection/permitting delays. The lower revenue was a key driver in EPS of ($0.24) missing our forecast by $0.07. Importantly, non-GAAP gross margins were inline with our forecast and operating costs were better than expected. Additionally, the company achieved its milestone of generating positive adjusted EBITDA during the quarter."

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