Shoals follows solid Q1 beat with two new analyst upgrades
Shoals Technologies (NASDAQ:SHLS) skyrockets in Tuesday's trading, +22.9% to a two-month high, after topping analyst estimates for Q1 earnings and revenues while also raising the lower end of its revenue forecast for the full year.
Guggenheim upgraded Shoals (SHLS) to Buy from Neutral with a $30 price target, saying the company's outlook for the rest of the year looks conservative.
Shoals (SHLS) delivered Q1 results that exceeded expectations, particularly for gross margins, and it appears the company is benefiting more than expected as revenue shifts to combine-as-you-go products, Guggenheim's Joseph Osha wrote, adding that falling material prices also are having an impact.
Osha also said relatively more of Shoals' (SHLS) growth is coming from market share gains as opposed to unexpected strength in utility-scale solar.
Northland Capital also upgraded the stock to Outperform from Market Perform with a $30 PT, noting the "solid" Q1 beat as well as the company's lawsuit filed against Hikam and Voltage, alleging patent infringement.
"We have doubted the enforceability of SHLS's patents in the past, but the fact that SHLS is now bringing a case suggests management... does in fact believe SHLS has defensible patents.
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Source: Seeking Alpha
