The Law Offices of Frank R. Cruz announces that a class action lawsuit has been filed on behalf of persons and entities that purchased or otherwise acquired Stem, Inc. (“Stem” or the “Company”) (NYSE: STEM) f/k/a Star Peak Energy Transition Corp. (“STPK”) securities: (a) pursuant and/or traceable to the Offering Documents issued in connection with the merger consummated April 28, 2021; and/or between March 4, 2021 and February 16, 2023, inclusive (the “Class Period”). Stem investors have until July 11, 2023 to file a lead plaintiff motion.
If you are a shareholder who suffered a loss, click here to participate.
On March 15, 2021, Stem disclosed that it had previously undisclosed material weaknesses in its control over financial reporting related to “accounting for . . . deferred cost of goods sold and inventory,” “the review of certain revenue recognition calculations,” and “the review of internal-use capitalized software calculations.” On this news, Stem’s stock price fell $1.19, or 3.4%, to close at $34.24 per share on March 15, 2021, thereby injuring investors.
On January 11, 2023, Blue Orca Capital published a report alleging various undisclosed issues with Stem’s business and financial prospects, including that the Company had overstated its software revenues by falsely claiming that the entirety of its services revenue line was attributable to software revenues.
On February 16, 2023, Stem released its fourth quarter 2022 results and its 2023 guidance, reporting a fourth quarter revenue of $156 million, missing consensus estimates by $10 million, and issued disappointing 2023 revenue guidance, missing consensus estimates by as much as $97 million. On this news, Stem’s stock price fell $1.44, or 14.8%, to close at $8.30 per share on February 17, 2023, thereby injuring investors further.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose materially adverse facts about the Company’s business, operations, and prospects. Specifically, the Offering Documents and Defendants failed to disclose to investors that: (1) Legacy Stem suffered from material weaknesses in internal control over financial reporting related to accounting for deferred cost of goods sold and inventory, certain revenue recognition calculations, and internal-use capitalized software calculations; (2) the Company had overstated Legacy Stem’s and its own post-Merger business and financial prospects; (3) Stem’s software revenue did not make up 100% of the Company’s services revenue; (4) Stem had overstated the benefits expected to flow from its AP partnership; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
Follow us for updates on Twitter: twitter.com/FRC_LAW.
If you purchased Stem securities during the Class Period, you may move the Court no later than July 11, 2023 to ask the Court to appoint you as lead plaintiff. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class. If you purchased Stem securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 1999 Avenue of the Stars, Suite 1100, Los Angeles, California 90067 at 310-914-5007, by email to email@example.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
The Law Offices of Frank R. Cruz Announces the Filing of a Securities Class Action on Behalf of Stem, Inc. f/k/a Star Peak Energy Transition Corp. (STEM) Investors