GURUFOCUS.COM » STOCK LIST » Technology » Software » Stem Inc (NYSE:STEM) » Definitions » Financial Strength

Stem (STEM) Financial Strength : 3 (As of Dec. 2023)


View and export this data going back to 2021. Start your Free Trial

What is Stem Financial Strength?

Stem has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.

Warning Sign:

Stem Inc displays poor financial strength. Usually, this is caused by too much debt for the company.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Stem did not have earnings to cover the interest expense. Stem's debt to revenue ratio for the quarter that ended in Dec. 2023 was 0.80. As of today, Stem's Altman Z-Score is -0.37.


Competitive Comparison of Stem's Financial Strength

For the Software - Infrastructure subindustry, Stem's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Stem's Financial Strength Distribution in the Software Industry

For the Software industry and Technology sector, Stem's Financial Strength distribution charts can be found below:

* The bar in red indicates where Stem's Financial Strength falls into.



Stem Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Stem's Interest Expense for the months ended in Dec. 2023 was $-4.9 Mil. Its Operating Income for the months ended in Dec. 2023 was $-33.5 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $534.1 Mil.

Stem's Interest Coverage for the quarter that ended in Dec. 2023 is

Stem did not have earnings to cover the interest expense.

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Stem's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(2.95 + 534.088) / 669.696
=0.80

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Stem has a Z-score of -0.37, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

Warning Sign:

Altman Z-score of -0.37 is in distress zone. This implies bankruptcy possibility in the next two years.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


Stem  (NYSE:STEM) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Stem has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.


Stem Financial Strength Related Terms

Thank you for viewing the detailed overview of Stem's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


Stem (STEM) Business Description

Traded in Other Exchanges
Address
100 California Street, 14th Floor, San Francisco, CA, USA, 94111
Stem is a provider of energy storage systems. The company bundles third-party hardware with its proprietary Athena software to provide customers a turnkey solution. Stem sells its solutions to commercial and industrial customers as well as independent power producers and renewable developers. Its solutions help customers maximize renewable energy generation and help build a cleaner and more resilient grid. In 2022, the company acquired AlsoEnergy, a provider of solar asset management software.
Executives
Rahul Shukla officer: Chief Accounting Officer 100 CALIFORNIA STREET, SAN FRANCISCO CA 94111
Michael James Carlson officer: Chief Operating Officer 100 CALIFORNIA STREET, SAN FRANCISCO CA 94111
David S Buzby director
Alan Russo officer: Chief Revenue Officer 100 ROLLINS ROAD, MILLBRAE CA 94030
Matthew Tappin officer: President, Asset Management 100 CALIFORNIA STREET, 14TH FLOOR, SAN FRANCISCO CA 94111
Lisa L Troe director 12181 BLUFF CREEK DRIVE, 4TH FLOOR, LOS ANGELES CA 90094
Saul R. Laureles officer: Chief Legal Officer 5599 SAN FELIPE, 17TH FLOOR, HOUSTON TX 77056
John Eugene Carrington director, officer: CEO and Director 350 WEST WASHINGTON STREET, SUITE 600, TEMPE AZ 85281
William John Bush officer: Chief Financial Officer 539 BRYANT STREET, SUITE 403, SAN FRANCISCO CA 94107
Kim Homenock officer: Chief People Officer 100 CALIFORNIA STREET, SAN FRANCISCO CA 94111
Robert Schaefer officer: President, AlsoEnergy 100 CALIFORNIA STREET, SAN FRANCISCO CA 94111
Larsh Johnson officer: Chief Technical Officer 100 ROLLINS RD, MILLBRAE CA 94030
Prakesh Patel officer: Chief Strategy Officer 100 ROLLINS ROAD, MILLBRAE CA 94030
Adam Daley director C/O MAGNETAR CAPITAL LLC, 1603 ORRINGTON AVENUE, 13TH FLOOR, EVANSTON IL 60201
Anil Tammineedi director 100 ROLLINS RD, MILLBRAE CA 94030

Stem (STEM) Headlines

From GuruFocus