Education
About Us
Working with TipRanks
Follow Us
Shoals Technologies Group (SHLS)
NASDAQ:SHLS
Top Page
Shoals Technologies Group
(NASDAQ:SHLS)
Rating:67Neutral
Price Target:
$7.00
▲(24.11%Upside)
Positive Factors
Market Positioning
Shoals is more insulated than its competitors who primarily source from China, making it relatively better positioned against tariff impacts.
Product Offering
Analysts anticipate margin stability, given Shoals offers a bespoke product with input costs secured in conjunction with signed purchase orders.
Revenue Visibility
Shoals reaffirmed revenue guidance with potential to achieve the high end, as management has not seen any indications of project delays from customers.
Negative Factors
Competitive Pressures
There are considerable investor concerns around growing competitive pressures for SHLS.
Cost Inflation
Cost inflation is anticipated to eventually impact projects, potentially driving the repricing of PPAs or project delays.
Tariff Volatility
Protracted tariff volatility and potential IRA changes could impact the industry at large, leading to lower bookings and awards in 2H25.
Shoals Technologies Group (SHLS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$922.81M
Dividend YieldN/A
Average Volume (3M)5.37M
Price to Earnings (P/E)49.9
Beta (1Y)0.84
Revenue Growth-18.10%
EPS Growth-36.91%
CountryUS
Employees1,290
SectorTechnology
Sector Strength93
IndustrySolar
Share Statistics
EPS (TTM)0.03
Shares Outstanding167,174,800
10 Day Avg. Volume4,689,597
30 Day Avg. Volume5,367,942
Financial Highlights & Ratios
PEG Ratio-2.33
Price to Book (P/B)1.76
Price to Sales (P/S)0.00
P/FCF Ratio13.31
Enterprise Value/Market Cap1.17
Enterprise Value/Revenue0.65
Enterprise Value/Gross Profit8.08
Enterprise Value/Ebitda4.10
Forecast
1Y Price Target
$6.46Price Target Upside14.54% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering17
Shoals Technologies Group Business Overview & Revenue Model
Company DescriptionShoals Technologies Group (SHLS) is a leading provider of electrical balance of system (EBOS) solutions for solar energy projects. The company specializes in engineering, designing, and manufacturing a comprehensive range of innovative products that facilitate the efficient transmission of electric power from solar panels to inverters. Shoals' offerings include custom-designed wire harnesses, inline fuses, junction boxes, and combiner boxes, which play a crucial role in optimizing the performance and reliability of solar energy systems.
How the Company Makes MoneyShoals Technologies Group generates revenue primarily through the sale of its electrical balance of system (EBOS) products to solar energy project developers and engineering, procurement, and construction (EPC) firms. The company's key revenue streams include the sale of wire harnesses, combiner boxes, and other electrical components essential for solar power generation. Shoals benefits from long-term supply agreements and strategic partnerships with major solar energy companies, which contribute significantly to its earnings. Additionally, the company's focus on innovation and cost-effective solutions helps maintain its competitive edge and attract a broad customer base in the growing renewable energy sector.
Shoals Technologies Group Key Performance Indicators (KPIs)
Any
Backlog
Represents the value of unfulfilled orders, showing future revenue visibility and overall product demand strength.
Represents the value of unfulfilled orders, showing future revenue visibility and overall product demand strength.
Data provided by:
Main Street Data
Main Street DataShoals Technologies Group Earnings Call Summary
Earnings Call Date:May 06, 2025
(Q1-2025)
| % Change Since: 50.00%|
Next Earnings Date:Aug 05, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong bookings, strategic growth initiatives, and positive cash flow, offset by revenue decline, margin pressure, and ongoing litigation. The sentiment is cautiously optimistic with significant progress in growth areas.Q1-2025 Updates
Positive Updates
Strong Bookings and Backlog
Shoals Technologies reported a robust backlog and awarded orders (BLAO) of $645.1 million, with approximately $91 million in new orders, resulting in a book-to-bill ratio of 1.13.
Successful Strategic Growth Initiatives
The company is making progress on strategic growth initiatives, including international expansion and new product launches, with over 15% of BLAO including new products.
Positive Cash Flow and Operational Improvements
Shoals Technologies reported a free cash flow of $12.4 million, with an improved balance sheet and the lowest net debt in four years.
Strong Customer Engagement and Market Position
Shoals' value proposition of high-quality products and exceptional engineering support is resonating with customers, leading to increased engagement and market share.
BESS and International Market Expansion
The company is expanding its Battery Energy Storage Solutions (BESS) offerings and announced an MOU with UGT Renewables for up to 12 gigawatts of international solar power projects.
Negative Updates
Revenue Decline and Margin Pressure
Net revenue declined 11.5% year-over-year to $80.4 million, with a decrease in gross profit margin to 35.0% due to product mix and strategic pricing actions.
Ongoing Litigation and Warranty Costs
Shoals Technologies is facing $9.5 million in wire insulation shrinkback remediation costs and ongoing litigation with Prysmian, affecting financial performance.
Impact of Tariffs and Regulatory Uncertainty
Geopolitical uncertainties and potential impacts of tariffs and domestic energy policies pose risks to the business environment.
Company Guidance
During the Shoals Technologies Group First Quarter 2025 Earnings Conference Call, the company provided detailed guidance for Q2 and the full year 2025. For Q2, revenue is expected to be between $100 million and $110 million, with adjusted EBITDA ranging from $20 million to $25 million. For the entire year, Shoals forecasts revenue of $410 million to $450 million and adjusted EBITDA of $100 million to $115 million. The company also expects cash flow from operations to be $30 million to $45 million, with capital expenditures between $25 million and $35 million, and interest expenses of $8 million to $12 million. Shoals highlighted a robust backlog and awarded orders totaling $645.1 million, with about $500 million scheduled for shipment over the next four quarters. The company remains optimistic about its market position, despite some geopolitical uncertainties and potential project timeline shifts, projecting gross margins in the mid to high 30% range for the rest of 2025.Shoals Technologies Group Financial Statement Overview
Summary
Shoals Technologies Group shows solid financial health with a strong balance sheet and efficient cash flow operations. However, challenges in maintaining revenue growth are evident, impacting future profitability. The company benefits from stable margins and strong equity financing.Income Statement
Shoals Technologies Group's income statement shows moderate profitability with a gross profit margin of 34.39% and a net profit margin of 5.78% for the TTM period. While the company has experienced fluctuations in revenue, the recent TTM revenue has decreased from the previous year. EBIT and EBITDA margins are stable at 11.29% and 14.77% respectively, indicating efficient operations despite declining revenue.65
Positive
Balance Sheet
The balance sheet of Shoals Technologies Group shows a healthy equity position with a debt-to-equity ratio of 0.25. The return on equity (ROE) is modest at 4.02%, reflecting moderate returns on shareholder investments. The equity ratio stands at 70.89%, indicating a strong reliance on equity financing which enhances financial stability.70
Positive
Cash Flow
The cash flow statement indicates effective cash management with a free cash flow to net income ratio of 3.29 and an operating cash flow to net income ratio of 3.70 for the TTM. The company has managed to generate positive free cash flow growth, which is a positive sign of operational efficiency.68
Positive
| Breakdown | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 399.21M | 488.94M | 326.94M | 213.21M | 175.52M |
| Gross Profit | 142.02M | 168.30M | 131.31M | 82.64M | 66.55M |
| EBITDA | 64.32M | 89.56M | 181.05M | 48.63M | 46.68M |
| Net Income | 24.13M | 39.97M | 127.61M | 3.94M | 33.77M |
Balance Sheet | |||||
| Total Assets | 793.08M | 843.99M | 594.89M | 426.41M | 195.31M |
| Cash, Cash Equivalents and Short-Term Investments | 23.51M | 22.71M | 8.77M | 5.01M | 10.07M |
| Total Debt | 141.75M | 184.70M | 239.06M | 247.05M | 358.83M |
| Total Liabilities | 236.28M | 299.00M | 293.91M | 433.91M | 379.43M |
| Stockholders Equity | 556.80M | 545.00M | 291.37M | 2.55M | -184.12M |
Cash Flow | |||||
| Free Cash Flow | 72.00M | 81.38M | 36.30M | -8.21M | 50.85M |
| Operating Cash Flow | 80.39M | 91.95M | 39.45M | -4.08M | 54.08M |
| Investing Cash Flow | -8.39M | -10.85M | -3.66M | -17.04M | -3.24M |
| Financing Cash Flow | -71.19M | -67.17M | -36.59M | 20.60M | -47.85M |
Shoals Technologies Group Technical Analysis
Positive
5.64
Price Trends
5.19
Positive
4.29
Positive
4.62
Positive
Market Momentum
0.22
Positive
60.68
Neutral
41.97
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SHLS, the sentiment is Positive. The current price of 5.64 is above the 20-day moving average (MA) of 5.50, above the 50-day MA of 5.19, and above the 200-day MA of 4.62, indicating a bullish trend. The MACD of 0.22 indicates Positive momentum. The RSI at 60.68 is Neutral, neither overbought nor oversold. The STOCH value of 41.97 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SHLS.
Shoals Technologies Group Risk Analysis
Shoals Technologies Group disclosed 28 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
Overall Rating
UnderperformOutperform
Sector (50)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $8.95B | 17.76 | 39.33% | ― | 21.46% | 123.22% | |
67 Neutral | $922.81M | 49.91 | 3.43% | ― | -18.10% | -36.91% | |
60 Neutral | $1.16B | 118.10 | -9.49% | 11.77% | -30.26% | -156.69% | |
57 Neutral | $1.08B | ― | -49.11% | ― | -21.31% | -593.57% | |
53 Neutral | $820.41M | 20.05 | -0.39% | ― | -19.06% | -104.91% | |
53 Neutral | $1.57B | ― | -121.50% | ― | -57.89% | -559.87% | |
50 Neutral | C$3.14B | 2.46 | -63.57% | 2.27% | 4.49% | -6.15% |
* Technology Sector Average
Performance Comparison
SHLS
Shoals Technologies Group
6.00
-0.63
-9.50%
CSIQ
Canadian Solar
13.46
-2.71
-16.76%
JKS
JinkoSolar
23.44
5.38
29.79%
SEDG
SolarEdge Technologies
28.83
3.31
12.97%
ARRY
Array Technologies
6.82
-4.13
-37.72%
NXT
NEXTracker, Inc. Class A
62.10
14.96
31.74%
Shoals Technologies Group Corporate Events
Executive/Board ChangesShareholder Meetings
Shoals Technologies Holds 2025 Annual Shareholder Meeting
Neutral
May 7, 2025
On May 1, 2025, Shoals Technologies Group, Inc. held its 2025 Annual Meeting of Shareholders, where key proposals were voted on. Shareholders elected Class I directors for a one-year term, approved the compensation of named executive officers, and ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for 2025.
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Shoals Technologies Announces CAO Resignation and CFO Transition
Neutral
May 6, 2025
Shoals Technologies Group reported its financial results for the first quarter of 2025, showing a revenue of $80.4 million and a net loss of $0.3 million. Despite a decrease in revenue and gross profit compared to the prior year, the company highlighted a robust backlog and awarded orders totaling $645.1 million, reflecting a 4.9% year-over-year increase. The company also announced the resignation of Chief Accounting Officer Inez Lund, effective May 16, 2025, with CFO Dominic Bardos taking over her responsibilities. Shoals remains optimistic about its market position, citing strong demand in international markets and strategic initiatives driving growth in various sectors.
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.