RAYS - Shoals- FCF Improvement Is Underappreciated But No Pressing Need To Buy Now

2024-03-06 16:49:25 ET

Summary

• Shoals Technology, a key provider of solar technology, is going through a slump on account of weak industry conditions, particularly within the utility scale segment.
• The stock's forward valuations look compelling relative to history, but there's good reason for this.
• Shoals' ongoing improvement in its cash flow position ought to be commended.
• The stock no longer looks overbought relative to other offerings in the solar space, but bearish conditions still linger.

Introduction

Solar energy may not be everyone’s cup of tea, but given its compelling LCOE (Levelized Cost of Electricity), which is a good 29% lower than other low-cost fossil fuel alternatives, it’s hard to look away for too long....

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