Stem (NYSE:STEM – Get Free Report) and BigBear.ai (NYSE:BBAI – Get Free Report) are both small-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their profitability, institutional ownership, risk, valuation, analyst recommendations, dividends and earnings.
Profitability
This table compares Stem and BigBear.ai’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Stem | 62.20% | N/A | -21.71% |
| BigBear.ai | -274.70% | -26.11% | -12.37% |
Volatility and Risk
Stem has a beta of 1.29, indicating that its stock price is 29% more volatile than the S&P 500. Comparatively, BigBear.ai has a beta of 3.45, indicating that its stock price is 245% more volatile than the S&P 500.
Analyst Recommendations
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Stem | 2 | 4 | 0 | 0 | 1.67 |
| BigBear.ai | 1 | 2 | 1 | 0 | 2.00 |
Stem currently has a consensus price target of $17.60, suggesting a potential upside of 56.22%. BigBear.ai has a consensus price target of $6.00, suggesting a potential upside of 46.27%. Given Stem’s higher probable upside, analysts clearly believe Stem is more favorable than BigBear.ai.
Insider and Institutional Ownership
61.6% of Stem shares are owned by institutional investors. Comparatively, 7.6% of BigBear.ai shares are owned by institutional investors. 5.1% of Stem shares are owned by insiders. Comparatively, 0.5% of BigBear.ai shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.
Valuation and Earnings
This table compares Stem and BigBear.ai”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Stem | $144.58 million | 0.65 | -$854.01 million | ($13.63) | -0.83 |
| BigBear.ai | $158.24 million | 11.32 | -$295.55 million | ($1.42) | -2.89 |
BigBear.ai has higher revenue and earnings than Stem. BigBear.ai is trading at a lower price-to-earnings ratio than Stem, indicating that it is currently the more affordable of the two stocks.
Summary
BigBear.ai beats Stem on 8 of the 14 factors compared between the two stocks.
About Stem
Stem, Inc. operates as a digitally connected, intelligent, and renewable energy storage network provider worldwide. The company offers energy storage hardware sourced from original equipment manufacturers (OEMs); edge hardware to aid in the collection of site data and real-time operation and control of the site and other optional equipment; and Athena, a software platform, which offers battery hardware and software-enabled services to operate the energy storage systems. It serves commercial and industrial enterprises, independent power producers, renewable project developers, and utilities and grid operators. The company was incorporated in 2009 and is headquartered in San Francisco, California.
About BigBear.ai
BigBear.ai Holdings, Inc. provides artificial intelligence-powered decision intelligence solutions. It offers national security, supply chain management, and digital identity and biometrics solutions. The company also provides data ingestion, data enrichment, data processing, artificial intelligence, machine learning, predictive analytics, and predictive visualization solutions and services. It serves nation defense and intelligence agencies, border protection, transportation security, manufacturing, distribution and logistics, travel, entertainment, and tourism sectors. The company is headquartered in Columbia, Maryland.
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