Shoals Technologies (SHLS) Target Increased to $8 at Mizuho

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(NASDAQ:SHLS) to $8 from $7 while maintaining a Neutral rating on the shares. The firm said the company’s sales performance continues to exceed expectations, although margins declined to 31.6% in the fourth quarter due to tariffs, legal expenses, and higher logistics costs. The same day, Guggenheim Partners analyst Joseph Osha lowered the firm’s price target to $11 from $12 while maintaining a Buy rating. Guggenheim updated its financial estimates following the company’s fourth-quarter report, but suggested that the market reaction to the results may be overly negative.Shoals Technologies Group, Inc. (NASDAQ:SHLS) reported fourth-quarter 2025 revenue of $148.3 million, representing a 39% year-over-year increase driven primarily by stronger demand for utility-scale solar projects. Gross profit rose to $46.9 million from $40.2 million in the prior-year quarter, although the gross margin declined to 31.6% from 37.6%. The company said the margin contraction was largely caused by higher material costs as well as approximately $3.3 million in duties and tariffs that were not present in the previous year. Adjusted EBITDA increased to $30.3 million from $26.4 million, while adjusted diluted earnings per share rose to $0.10 compared with $0.08 a year earlier.For the full-year 2025, Shoals Technologies Group, Inc. (NASDAQ:SHLS) reported revenue growth of 19%, reaching $475.3 million. The company also ended the year with record backlog and awarded orders totaling $747.6 million, reflecting sustained demand for its solar infrastructure products across both domestic and international markets. Looking ahead, the company expects revenue between $560 million and $600 million in 2026, along with adjusted EBITDA ranging from $110 million to $130 million. Management also issued first-quarter guidance, noting that changing customer order patterns in the utility-scale solar market could create short-term headwinds.Shoals Technologies Group, Inc. (NASDAQ:SHLS) provides electrical balance-of-system solutions for solar power installations, battery storage systems, and related energy infrastructure projects.While we acknowledge the potential of SHLS as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. 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