Analysts Are Updating Their Shoals Technologies Group, Inc. (NASDAQ:SHLS) Estimates After Its First-Quarter Results

The investors in Shoals Technologies Group, Inc.'s (NASDAQ:SHLS) will be rubbing their hands together with glee today, after the share price leapt 28% to US$4.82 in the week following its first-quarter results. Revenues beat expectations, coming in 7.8% ahead of forecasts, and the company broke even on a statutory earnings per share (EPS) level. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Shoals Technologies Group after the latest results.

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Following the latest results, Shoals Technologies Group's 20 analysts are now forecasting revenues of US$434.8m in 2025. This would be a decent 12% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to jump 123% to US$0.25. Before this earnings report, the analysts had been forecasting revenues of US$426.3m and earnings per share (EPS) of US$0.26 in 2025. So it looks like there's been a small decline in overall sentiment after the recent results - there's been no major change to revenue estimates, but the analysts did make a small dip in their earnings per share forecasts.

See our latest analysis for Shoals Technologies Group

It might be a surprise to learn that the consensus price target was broadly unchanged at US$6.23, with the analysts clearly implying that the forecast decline in earnings is not expected to have much of an impact on valuation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. Currently, the most bullish analyst values Shoals Technologies Group at US$10.00 per share, while the most bearish prices it at US$3.90. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We can infer from the latest estimates that forecasts expect a continuation of Shoals Technologies Group'shistorical trends, as the 16% annualised revenue growth to the end of 2025 is roughly in line with the 17% annual growth over the past three years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 8.1% per year. So although Shoals Technologies Group is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for Shoals Technologies Group. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Shoals Technologies Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Shoals Technologies Group going out to 2027, and you can see them free on our platform here..

Before you take the next step you should know about the 2 warning signs for Shoals Technologies Group that we have uncovered.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.