Shoals Technologies Group (SHLS)
NASDAQ:SHLS
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Shoals Technologies Group
(NASDAQ:SHLS)
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Rating:58Neutral
Price Target:
$7.00
▲(0.43% Upside)
Action:ReiteratedDate:02/27/26
The score is driven primarily by mixed fundamentals: solid margins and a conservatively levered balance sheet are offset by materially weakened cash generation (negative TTM free cash flow). Earnings-call guidance and record backlog improve the growth outlook, but near-term margin and cash pressures remain. Technicals are a notable headwind given the pronounced downtrend and negative momentum, while valuation is only moderate-to-unfavorable due to the high P/E and lack of dividend support.
Positive Factors
Record backlog / revenue visibility
A large, near‑term backlog materially reduces revenue visibility risk and supports durable top‑line growth and factory utilization. With ~$603M slated to ship within a year, management can scale production, lock customer demand, and better plan capital allocation over the next 2–6 months.
Negative Factors
Weak cash conversion / negative FCF
Recent negative free cash flow and weak operating cash conversion strain liquidity and limit internal funding for growth or legal contingencies. Persistently weak FCF raises dependence on external financing, increasing refinancing risk and constraining durable investments unless cash conversion improves.
Read all positive and negative factors
Positive Factors
Negative Factors
Record backlog / revenue visibility
A large, near‑term backlog materially reduces revenue visibility risk and supports durable top‑line growth and factory utilization. With ~$603M slated to ship within a year, management can scale production, lock customer demand, and better plan capital allocation over the next 2–6 months.
Read all positive factors
Shoals Technologies Group (SHLS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.17B
Dividend YieldN/A
Average Volume (3M)4.86M
Price to Earnings (P/E)42.3
Beta (1Y)0.65
Revenue Growth2.68%
EPS Growth2.90%
CountryUS
Employees1,290
SectorTechnology
Sector Strength88
IndustrySolar
Share Statistics
EPS (TTM)0.10
Shares Outstanding167,450,320
10 Day Avg. Volume3,349,434
30 Day Avg. Volume4,861,489
Financial Highlights & Ratios
PEG Ratio0.99
Price to Book (P/B)2.37
Price to Sales (P/S)2.99
P/FCF Ratio-88.99
Enterprise Value/Market Cap1.14
Enterprise Value/Revenue2.81
Enterprise Value/Gross Profit8.02
Enterprise Value/Ebitda18.91
Forecast
1Y Price Target
$9.67Price Target Upside38.74% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
EPS Forecast (FY)0.4
Revenue Forecast (FY)$586.49M
Shoals Technologies Group Business Overview & Revenue Model
Company Description
Shoals Technologies Group, Inc. provides electrical balance of system (EBOS) solutions for solar energy projects in the United States. It produces EBOS components, including cable assemblies, inline fuses, combiners, disconnects, recombiners, wire...
How the Company Makes Money
Shoals makes money primarily by selling EBOS products and related components used to build and operate solar PV (and, to a lesser extent, storage) projects. Its core revenue stream is product sales to customers in the solar project supply chain—co...
Shoals Technologies Group Key Performance Indicators (KPIs)
Any
Revenue by Segment
Breaks down revenue by business segments, highlighting which areas are driving growth and profitability, and indicating strategic focus and market strength.
Breaks down revenue by business segments, highlighting which areas are driving growth and profitability, and indicating strategic focus and market strength.
Data provided by:
The Fly
The FlyShoals Technologies Group Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 05, 2026
Earnings Call Sentiment Neutral
The call presented a balanced picture: strong top‑line growth, record backlog, rapid expansion into BESS, international and OEM channels, and clear revenue guidance for 2026 are material positives. Offsetting these are compressed margins, significant and ongoing legal expenses, tariff headwinds, short‑term cash and free‑cash‑flow pressure, and transitional inefficiencies from the factory consolidation. Management framed margin compression as partly transitory and emphasized strategy to prioritize profitable growth and cash generation while scaling new markets.Positive Updates
Quarterly Revenue Growth
Company reported fourth-quarter revenue of approximately $140.3M (CEO also referenced ~ $148M), up 38.6% year‑over‑year; management emphasized a return to growth with full‑year 2025 revenue up ~19% versus 2024.
Negative Updates
Gross Margin Compression
GAAP gross profit percentage fell to 31.6% in Q4 from 37.6% prior year (GAAP gross profit dollars $46.9M, +16.7% YoY). Management now expects gross margin in the low‑ to mid‑30s for 2026, below prior aspirational 40%+ target.
Read all updates
Q4-2025 Updates
Positive
Negative
Quarterly Revenue Growth
Company reported fourth-quarter revenue of approximately $140.3M (CEO also referenced ~ $148M), up 38.6% year‑over‑year; management emphasized a return to growth with full‑year 2025 revenue up ~19% versus 2024.
Read all positive updates
Company Guidance
Management guided Q1 2026 revenue of $125–135 million (≈62% YoY growth at the midpoint) and adjusted EBITDA of $16–21 million (≈44% YoY growth at the midpoint). For full‑year 2026 they expect revenue of $560–600 million (≈22% YoY growth at the midpoint) and adjusted EBITDA of $110–130 million (≈21% YoY growth at the midpoint), with operating cash flow of $65–85 million, capital expenditures of $20–30 million, and interest expense of $8–12 million. The company enters 2026 with record backlog & awarded orders (BLAO) of $747.6 million (of which $603.4 million is planned to ship in the next four quarters and $144.2 million beyond), reported year‑end cash of $7.3 million and net debt of $129.4 million (net debt/adjusted EBITDA 1.3x), and signaled gross margin expectations in the low‑ to mid‑30s (noting tariff headwinds—$3.7 million impact in 2025, ~80 bps on full‑year gross margin—and Q4 incremental hits of ~$2.1M tariffs/logistics, $2.5M labor, $0.5M overhead that pressured margins by ~350 bps).Shoals Technologies Group Financial Statement Overview
Summary
Income Statement
68
Positive
Balance Sheet
78
Positive
Cash Flow
44
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 475.33M | 399.21M | 488.94M | 326.94M | 213.21M |
| Gross Profit | 166.51M | 142.02M | 168.30M | 131.31M | 82.64M |
| EBITDA | 67.11M | 64.32M | 89.56M | 181.05M | 28.63M |
| Net Income | 33.57M | 24.13M | 39.97M | 127.61M | 2.35M |
Balance Sheet | |||||
| Total Assets | 904.10M | 793.08M | 843.99M | 594.89M | 426.41M |
| Cash, Cash Equivalents and Short-Term Investments | 7.32M | 23.51M | 22.71M | 8.77M | 5.01M |
| Total Debt | 175.41M | 141.75M | 181.44M | 239.06M | 247.05M |
| Total Liabilities | 304.13M | 236.28M | 299.00M | 293.91M | 433.91M |
| Stockholders Equity | 599.97M | 556.80M | 545.00M | 291.37M | 2.55M |
Cash Flow | |||||
| Free Cash Flow | -15.98M | 72.00M | 81.38M | 36.30M | -8.21M |
| Operating Cash Flow | 17.07M | 80.39M | 91.95M | 39.45M | -4.08M |
| Investing Cash Flow | -27.95M | -8.39M | -10.85M | -3.66M | -17.04M |
| Financing Cash Flow | -5.30M | -71.19M | -67.17M | -36.59M | 20.60M |
Shoals Technologies Group Technical Analysis
Neutral
6.97
Price Trends
7.69
Negative
8.18
Negative
7.67
Negative
Market Momentum
-0.13
Negative
52.37
Neutral
59.88
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHLS, the sentiment is Neutral. The current price of 6.97 is above the 20-day moving average (MA) of 6.46, below the 50-day MA of 7.69, and below the 200-day MA of 7.67, indicating a neutral trend. The MACD of -0.13 indicates Negative momentum. The RSI at 52.37 is Neutral, neither overbought nor oversold. The STOCH value of 59.88 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SHLS.
Shoals Technologies Group Risk Analysis
Shoals Technologies Group disclosed 26 risk factors in its most recent earnings report. Shoals Technologies Group reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Shoals Technologies Group Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $272.93M | -47.72 | -16.66% | ― | 97.41% | 11.83% | |
62 Neutral | $2.53B | -4.26 | -80.50% | ― | -0.14% | 66.71% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
58 Neutral | $1.17B | 42.34 | 5.78% | ― | 2.68% | 2.90% | |
53 Neutral | $1.10B | -26.92 | -15.43% | ― | 35.75% | 37.97% | |
50 Neutral | $133.89M | -4.13 | ― | ― | 657.27% | ― | |
45 Neutral | $55.64M | -1.99 | 1044.27% | ― | 39.53% | -7.16% |
* Technology Sector Average
SHLS
Shoals Technologies Group
6.97
3.56
104.40%
SEDG
SolarEdge Technologies
41.84
29.08
227.90%
ARRY
Array Technologies
7.21
2.95
69.25%
FTCI
FTC Solar
3.57
0.71
24.83%
SPWR
SunPower Inc
1.12
-0.32
-22.22%
TYGO
Tigo Energy
3.61
2.87
387.84%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.