Stem cells are a class of undifferentiated cells that are able to differentiate into specialized cell types by mitosis. Commonly, stem cells come from two main sources: 1. Embryos formed during the blastocyst phase of embryological development (embryonic stem cells) 2. Adult tissue (adult stem cells) that regenerate the damaged tissues. Both types are generally characterized by their potency, or potential to differentiate into different cell types (such as skin, muscle, bone, etc.) Both of the given statements are correct.