Shoals Technologies Group (Shoals Technologies Group) Predictability Rank

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What is Shoals Technologies Group Predictability Rank?

Not Rated

Warren Buffett said many times that the companies he likes are:

1. Simple businesses that he understands
2. that have predictable and proven earnings and
3. with economic moat
4. those can be bought at a reasonable price.

It is hard to quantify "simple businesses that he (Buffett) understands", so we will focus on the other three characteristics instead. In GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank, we will show that the businesses that have predictable and proven earnings are usually also simple businesses that an average person could understand.

GuruFocus conducted a back test study of Warren Buffett's strategy of "buying good companies at fair prices" for the years from 1998-2008.

Shoals Technologies Group Predictability Rank Calculation

In our database there are 2403 stocks that have been traded from Jan. 2, 1998 to Aug. 31, 2008. We have the complete 10-year financial data and trading prices of these companies for this period. We rank the predictability of these companies based on the consistency of their revenue per share and EBITDA (earning before interest, tax, depreciation and amortization) per share over the past ten fiscal years, and study the correlation between the stock performances and the predictability of the business.

Our study may be subject to these biases and assumptions:

Dividend yields are not counted for investment returns
Effects of price changes due to spin-offs may not be fully adjusted
Study is subjected to survivorship bias due to de-listing, bankruptcy, LBO, M&A, etc.

The correlation between business predictability and investment returns of a company is showed below.

Correlation Between Business Predictability and Investment Returns

	Predictables	Non-Predictable	All stocks
Total Number of stocks	570	1833	2403
Total Lost Money	61	830	891
Total Lost More Than 50%	18	412	430
Total Lost More Than 90%	4	86	90
Average Gain	260.6%	100.0%	138.1%
Median Gain	150.0%	13.0%	39.0%
Maximum Gain	2852.0%	11483.0%	11483.0%
Maximum Loss	-100.0%	-100.0%	-100.0%
Annualized Average Gain	12.7%	6.7%	8.4%
Annualized Median Gain	8.9%	1.1%	3.1%

For the 570 predictable companies, we have seen strong correlation between the predictability of businesses and the stock performances over the past 10 years, regardless of the valuation of business at 1998. Accordingly, we have ranked the business predictability from 5-star to 1-star, as shown in this table.

Predictability Rank	5-Star	4.5-Star	4-Star	3.5-Star	3-Star	2.5-Star	2-Star	1-Star (non-predictable)	Average among all
% Out of All 2403 Stocks	3.3%	2.9%	3.7%	3.3%	3.3%	3.7%	3.3%	76.3%	100%
% that are in Loss (10y)	3%	10%	8%	9%	11%	18%	16%	45%	37%
Average Gain (10y)	364.6%	330.9%	278.0%	235.1%	243.5%	227.8%	154.8%	100.0%	138.1%
Median Gain (10y)	238.5%	193.5%	171.0%	159.0%	132.5%	113.5%	87.0%	13.0%	39.0%
Maximum Gainer	2228.0%	2547.0%	2452.0%	2852.0%	2432.0%	1892.0%	1807.0%	11483.0%	11483.0%
Maximum Loser	-82.0%	-53.0%	-67.0%	-100.0%	-83.0%	-100.0%	-78.0%	-100.0%	-100.0%
Annualized Average Gain	15.4%	14.6%	13.2%	12.0%	12.2%	11.7%	9.1%	6.7%	8.4%
Annualized Median Gain	12.1%	10.6%	9.8%	9.3%	8.2%	7.3%	6.0%	1.1%	3.1%

For detailed information about each predictability rank, please go to GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank

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Shoals Technologies Group (Shoals Technologies Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » Shoals Technologies Group Inc (NAS:SHLS) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

SHLS:Mexico

Address

1400 Shoals Way, Portland, TN, USA, 37148

Website

https://www.shoals.com

Shoals Technologies Group Inc is a provider of electrical balance of system or EBOS solutions for solar energy projects, primarily in the United States. EBOS encompasses components that are necessary to carry electric current produced by solar panels to an inverter. The products are sold principally to engineering, procurement and construction firms that build solar energy projects. In 2022 the company entered the electric vehicle charging market.

Executives

Jeffery Tolnar	officer: President	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Mehgan Peetz	officer: General Counsel	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Dominic Bardos	officer: Chief Financial Officer	1801 RUSSELLVILLE RD, BOWLING GREEN KY 42101
Brandon Moss	officer: Chief Executive Officer	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Jason R Whitaker	director, officer: Chief Executive Officer	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Dean Solon	director	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Jeannette M Mills	director	C/O MEDIFAST, INC., 3600 CRONDALL LANE, OWINGS MILLS MD 21117
Robert K. Julian	director	C/O SPORTSMAN'S WAREHOUSE, 7035 SOUTH HIGH TECH DRIVE, MIDVALE UT 84047
Philip A Garton	officer: Chief Financial Officer	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
White John Joseph Jr	officer: Chief Operating Officer	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Bam Partners Trust	10 percent owner	181 BAY STREET, SUITE 300, TORONTO A6 M5J 2T3
Lori S Sundberg	director	400 NORTH FIFTH STREET, PHOENIX AZ 85004
Ty P. Daul	director	77 RIO ROBLES, SAN JOSE CA 95134
Toni Volpe	director	C/O SHOALS TECHNOLOGIES GROUP, 1400 SHOALS WAY, PORTLAND TN 37148
Solon Holdco Iii, Llc	10 percent owner	1400 SHOALS WAY, PORTLAND TN 37148