Stem price target raised by 50c at BofA, here’s why

BofA raised the firm’s price target on Stem to $3 from $2.50 and keeps an Underperform rating on the shares. The firm made several adjustments to its model and mark-to-market peer multiples for 2025/2026, which comes together to drive its price target higher. However, the firm remains cautious on management’s long-term aspiration to grow software/services revenue at a 65%-85% CAGR from 2022-2025.