In its February 2021 Silver News report, The Silver Institute forecasted that this year, the photovoltaic sector will continue its solid recovery, which kicked off in the second half of 2020. Photovoltaics are a way of generating electric power via solar cells, which convert solar energy into direct current electricity through the use of semiconducting materials that exhibit the photovoltaic effect.
The outlook for the photovoltaic space is promising, and investors are definitely on the hunt for players that are positioned to take advantage of the expected strong industry tailwinds.
Shoals Technologies Group
Based in Portland, Tennessee, Shoals Technologies Group, Inc. (SHLS) could be a good candidate.
Shoals Technologies sells electrical balance of system (EBOS) components, with competitive installation reflecting the primary reason why solar energy builders will continue to prefer Shoals’ products, potentially driving an increase in sales in the U.S.
Full Year 2020 Earnings
The COVID-19 pandemic created challenging conditions for operators in the solar industry, but resilient demand for solar EBOS enabled Shoals to report solid gains in total revenues and adjusted EBITDA margins.
Total funds, which include available cash on hand and funds from yearly operations combined with an additional $157 million invested in backlog orders, provide Shoals Technologies with the financial resources to implement growth strategies.
The company will make a significant effort to expand the user base for its innovative in-line fuse and wire manufacturing technology.
Additionally, Shoals Technologies will try to enhance the overall value of the portfolio by offering more products for electric vehicle (EV) charging infrastructure and battery storage as well as products that are used in combination with EBOS.
Market Prospects And Strategic Leadership Changes
The energy transition, which we are observing in some western countries and in China, is just the beginning of what is going to become a global trend soon, with the photovoltaic and the EV infrastructure markets primed to grow faster than most other technology industries.
What’s more, the company recently added three new members to its Board of Directors, with all three bringing significant expertise to the table.
Wall Street’s Take
In the last three months, 11 ratings have been assigned by Wall Street analysts, consisting of 7 Buys and 4 Holds. So, Shoals Technologies is a Moderate Buy. At $41.30, the average analyst price target suggests 25% upside potential. (See Shoals Technologies stock analysis on TipRanks)
Summary
The company is positioned to benefit from the expected robust demand for its products in North America and internationally.
In order to capitalize on the highest possible number of opportunities, Shoals Technologies is broadening its offerings, and developing an impressive international sales pipeline, and thus, the stock represents an opportunity.
Disclosure: On the date of publication, the author did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Disclaimer: The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities.
