Fact based stock research
Shoals (NasdaqGM:SHLS)

US82489W1071

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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

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Shoals stock research in summary

shoals.com

ANALYSIS: With an Obermatt Combined Rank of 31 (worse than 69% compared with investment alternatives), Shoals (Electr. Components & Equipment, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Shoals are a good value (attractively priced) with a consolidated Value Rank of 61 (better than 61% of alternatives) but show below-average growth (Growth Rank of 33), and are riskily financed (Safety Rank of 41), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 31, is a hold recommendation based on Shoals's financial characteristics. As the company Shoals's key financial metrics exhibit good value (Obermatt Value Rank of 61) but low growth (Obermatt Growth Rank of 33) and risky financing practices (Obermatt Safety Rank of 41), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 61% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	61
Growth Rank	33
Safety Rank	41
Combined Rank	31

Country	USA
Industry	Electr. Components & Equipment
Index	NASDAQ
Size class	Small

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Shoals

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	31	13	61
GROWTH
GROWTH	n/a	75	91	33
SAFETY
SAFETY	n/a	14	6	41
SENTIMENT
SENTIMENT	n/a	32	77	^new
360° VIEW
360° VIEW	n/a	17	36	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Shoals is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	31	13	61
GROWTH
GROWTH	n/a	75	91	33
SAFETY
SAFETY	n/a	14	6	41
COMBINED
COMBINED	n/a	24	21	31

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Shoals the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 61 (better than 61% compared with alternatives), Shoals shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Shoals. Price-to-Profit (also referred to as price-earnings, P/E) is 83 which means that the stock price compared with what market professionals expect for future profits is lower than for 83% of comparable companies, indicating a good value concerning Shoals's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 81, which means that the stock price is lower as regards to invested capital than for 81% of comparable investments. On the other hand, Price-to-Sales is less favorable than for 51% of alternatives (only 49% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than for 99% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 61, is a buy recommendation based on Shoals's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high concerning expected revenues, the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting Group or BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than distribute it to shareholders through dividends, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	n/a	13	24	49
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	n/a	21	43	83
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	n/a	100	35	81
DIVIDEND YIELD
DIVIDEND YIELD	n/a	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	n/a	31	13	61

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Shoals; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 33 (better than 33% compared with alternatives), Shoals shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Shoals. Sales Growth has a rank of 58 which means that currently, professionals expect the company to grow more than 58% of its competitors. Capital Growth is also above 22% of competitors with a rank of 89. But Profit Growth only has a rank of 22, which means that currently professionals expect the company to grow its profits less than 78% of its competitors. And Stock Returns have also been below average with a rank of only 13. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 33, is a hold recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	n/a	88	88	58
PROFIT GROWTH
PROFIT GROWTH	n/a	17	90	22
CAPITAL GROWTH
CAPITAL GROWTH	n/a	97	77	89
STOCK RETURNS
STOCK RETURNS	n/a	25	29	13
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	n/a	75	91	33

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Shoals.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 41 (better than 41% compared with alternatives), the company Shoals has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Shoals is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Shoals and the other two below average. Leverage is at a rank of 56 meaning the company has a below-average debt-to-equity ratio. It has less debt than 56% of its competitors.Refinancing is at a rank of 42, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 58% of its competitors. Liquidity is at a rank of 37, meaning that the company generates less profit to service its debt than 63% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 41 (worse than 59% compared with alternatives), Shoals has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Shoals are on the safer side. Investors may have a short-term debt challenge and liquidity issues with Shoals and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	n/a	1	22	56
REFINANCING
REFINANCING	n/a	5	11	42
LIQUIDITY
LIQUIDITY	n/a	68	41	37
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	n/a	14	6	41

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Shoals and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	32	68	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	55	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	72	53	^new
MARKET PULSE
MARKET PULSE	n/a	14	66	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	32	77	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Shoals.
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