Shoals Technologies (SHLS, Financial) has entered into a memorandum of understanding with UGT Renewables to jointly work on up to 12 gigawatts of solar projects around the world. The partnership intends to advance energy storage and distribution solutions in developing regions, contributing to a faster transition to renewable energy and fostering sustainable development.
In Angola, Shoals and UGT Renewables’ affiliate, Sun Africa, are set to launch the initial energy diversification projects in the Southern Provinces. The projects involve 600 MW of Solar PV, with deployment scheduled to start later this year. These initiatives, backed by financing from the United States' EXIM Bank, are anticipated to commence construction in 2025. The projects aim to provide electricity to 60% of Angola's population and deliver clean water to over 1.1 million residents.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 20 analysts, the average target price for Shoals Technologies Group Inc (SHLS, Financial) is $6.15 with a high estimate of $10.50 and a low estimate of $3.20. The average target implies an upside of 63.43% from the current price of $3.76. More detailed estimate data can be found on the Shoals Technologies Group Inc (SHLS) Forecast page.
Based on the consensus recommendation from 22 brokerage firms, Shoals Technologies Group Inc's (SHLS, Financial) average brokerage recommendation is currently 2.1, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Shoals Technologies Group Inc (SHLS, Financial) in one year is $17.97, suggesting a upside of 377.93% from the current price of $3.76. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Shoals Technologies Group Inc (SHLS) Summary page.
SHLS Key Business Developments
Release Date: February 25, 2025
- Revenue: $107 million for Q4 2024, a decline of 18.0% year-over-year.
- Bookings: $145 million in new projects for Q4 2024.
- Total Backlog and Awarded Orders (BLAO): $635 million as of December 31, 2024.
- Adjusted Gross Profit Percentage: 37.6% for Q4 2024.
- Adjusted EBITDA: $26.4 million for Q4 2024, representing 24.7% of revenue.
- Net Income: $7.8 million for Q4 2024.
- Adjusted Net Income: $14.1 million for Q4 2024.
- Cash Flow from Operations: $14.0 million for Q4 2024.
- Capital Expenditures: $1.5 million for Q4 2024.
- Full Year Revenue: $399 million for 2024, an 18.4% decline from 2023.
- Full Year Adjusted Gross Profit Percentage: 39% for 2024.
- Guidance for Q1 2025 Revenue: $70 million to $80 million.
- Guidance for Full Year 2025 Revenue: $410 million to $450 million.
- Guidance for Full Year 2025 Adjusted EBITDA: $100 million to $115 million.
- Guidance for Full Year 2025 Cash Flow from Operations: $30 million to $45 million.
- Guidance for Full Year 2025 Capital Expenditures: $25 million to $35 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Shoals Technologies Group Inc (SHLS, Financial) delivered strong fourth-quarter revenue of $107 million, at the high end of their expected range.
- The company reported robust bookings of $145 million in new projects, resulting in a total backlog and awarded orders of $635 million.
- Shoals Technologies Group Inc (SHLS) introduced over a dozen new products in 2024, addressing real business problems faced by customers.
- The company is expanding into new market segments like CC&I and BESS, and winning projects in international markets.
- Shoals Technologies Group Inc (SHLS) is consolidating small factories into a state-of-the-art facility in Tennessee, which is expected to drive increased productivity through automation.
Negative Points
- Adjusted gross profit percentage in the fourth quarter was softer than expected at 37.6%, due to a competitive environment and product mix.
- The company experienced an 18.4% decline in full-year revenue from 2023, driven by widespread project delays in the industry.
- Net income for the fourth quarter decreased to $7.8 million compared to $16.6 million in the prior year period.
- The ongoing litigation with Voltage and the ITC case has been a source of uncertainty, with the ITC not upholding the ALJ's initial determination.
- Shoals Technologies Group Inc (SHLS) anticipates a lighter first half of 2025, with only 40% of revenue expected in the first half, requiring higher working capital investment.
