Star Peak Energy Transition is a SPAC that wants to take Stem Inc. public. Stem, an energy storage company, was founded in 2009 and provides solutions that address issues in the dynamic energy market. Stem enables customers and partners to optimize energy use by automatically switching between battery power, onsite generation, and grid power.
Stem uses an AI platform called Athena to manage its systems. The company’s backers include Activate Capital, Constellation Technology Ventures, and RWE Supply & Trading. Is STPK stock a good buy?
Star Peak Energy and Stem merger date
On December 4, 2020, Stem Inc. agreed to go public by merging with SPAC Star Peak Energy Transition Corp. The merger values Stem at nearly $1.35 billion. Through the deal, Stem will receive about $608 million in gross proceeds. Stem plans to invest the funds in its growing grid technology, which helps support forms of green energy.
Star Peak raised $350 million in an IPO in August 2020. The SPAC is focused on a business that helps transition to newer sources of energy. The date for the merger hasn’t been finalized yet but it's expected to happen in the first quarter of 2021. After the merger, the combined company is expected to start trading on the NYSE under the ticker symbol "STEM."
Star Peak STPK on Stocktwits
Star Peak stock returned more than 100 percent in December when it announced the proposed merger with Stem. The huge spike in the stock and its deal with an AI-focused energy storage company led to a lot of buzz on stock forums including Stocktwits.
While most of the users are positive about the stock's potential, there are skeptics as well. One user named Oceanavekid said, “$STPK not sure why people listen to Citron but even without that jackass calling out 100 price target it’s worth that any day of the week.”
Another user named Tyler87 is skeptical about Stem’s prospects and Citron’s bullish call on the name. He said, “$STPK xl was given a $100 price target by citron also. It went to $35 then quickly to $19. Don’t get too excited.”
Due to President-elect Biden’s push for cleaner energy and investors’ awareness of alternative energy stocks, Stem’s IPO is expected to create a lot of buzz.
Star Peak STPK stock forecast
Since Star Peak is a SPAC, its stock price will depend on how well Stem performs. Currently, the trend is favoring clean energy stocks. Since Stem helps provide a continuous green energy solution, it helps solve a major issue that stops commercial and large organizations to shift to clean energy.
Recently, Citron Research gave a very bullish call on the stock. It expects STPK stock to go beyond $100 from its current market price of $31. Citron Research said, “STPK is the 800-pound gorilla in this market. In 2019, Stem installed 3x the energy storage of its largest competitor in California, which is the largest energy market in the US.”
STPK stock looks like a buy
STPK is the industry leader in AI-driven energy storage solutions. One of the big catalysts for green energy stocks, including Stem, is Biden’s $2 trillion green plan. The company already has 90 percent of its 2021 revenues committed in existing contracts with previous customers.
Stem’s total addressable market is more than $1 trillion. The industry-leading technology should make the company a leader in this space. Stem expects 51 percent annualized revenue growth from 2021 to 2026, which is much higher than its peers. The company's valuation is lower than its peers like QuantumScape, ChargePoint, and Luminar, which are also big on clean energy. Based on Stem's future potential, the stock looks like a buy.