Financial Contrast: Stem (NYSE:STEM) and TeraWulf (NASDAQ:WULF)

Stem (NYSE:STEM) and TeraWulf (NASDAQ:WULF) are both technology companies, but which is the superior stock? We will compare the two businesses based on the strength of their profitability, institutional ownership, earnings, risk, dividends, valuation and analyst recommendations.

Profitability

This table compares Stem and TeraWulf’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Stem	-49.37%	N/A	-21.85%
TeraWulf	-1,179.94%	-458.62%	-8.54%

Volatility and Risk

Stem has a beta of 1.52, indicating that its share price is 52% more volatile than the S&P 500. Comparatively, TeraWulf has a beta of 3.7, indicating that its share price is 270% more volatile than the S&P 500.

Institutional & Insider Ownership

61.6% of Stem shares are held by institutional investors. Comparatively, 62.5% of TeraWulf shares are held by institutional investors. 5.1% of Stem shares are held by insiders. Comparatively, 15.9% of TeraWulf shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Analyst Recommendations

This is a summary of recent recommendations for Stem and TeraWulf, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Stem	1	4	0	0	1.80
TeraWulf	1	2	16	3	2.95

Stem currently has a consensus price target of $7.45, indicating a potential upside of 61.36%. TeraWulf has a consensus price target of $34.21, indicating a potential upside of 136.46%. Given TeraWulf’s stronger consensus rating and higher probable upside, analysts plainly believe TeraWulf is more favorable than Stem.

Valuation and Earnings

This table compares Stem and TeraWulf”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Stem	$148.03 million	0.30	$137.76 million	($8.49)	-0.54
TeraWulf	$165.19 million	43.70	-$661.42 million	($4.37)	-3.31

Stem has higher earnings, but lower revenue than TeraWulf. TeraWulf is trading at a lower price-to-earnings ratio than Stem, indicating that it is currently the more affordable of the two stocks.

Summary

TeraWulf beats Stem on 11 of the 15 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 TeraWulf

TeraWulf Inc., together with its subsidiaries, operates as a digital asset technology company in the United States. The company develops, owns, and operates bitcoin mining facilities in New York and Pennsylvania. It is also involved in the provision of miner hosting services to third-party entities. The company was founded in 2021 and is headquartered in Easton, Maryland.