STEM - Stem: Blurry Outlook And Weak Fundamentals Sell

2024-07-19 02:50:39 ET

Summary

• Stem, Inc. (STEM) shows weakening fundamentals despite turnaround efforts, with stock down 38% since previous coverage.
• Technical analysis indicates a bearish trend with the stock breaking below the support zone, negative indicators, and declining trading volume.
• The company's profitability worsens, debt remains high, and the future outlook is bleak with consistent downward revisions and insider selling.

Investment Thesis

I am bearish on Stem, Inc.( STEM ) due to its weakening fundamentals despite the turn-around strategies and the bleak outlook as demonstrated by consistent downward revisions. In my previous article published in March, I reiterated a hold decision because the stock appeared to be in a consolidation phase where a trend reversal from a bearish trajectory to bullish momentum looked likely, especially given the optimism arising from the turnaround strategies the company was improving. However, the stock is below the support zone and it has lost about 38% since that coverage....

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