Title
Earning Preview: Shoals Technologies Group revenue is expected to increase by 42%, institutional views are bullish
Abstract
Shoals Technologies Group is scheduled to report quarterly results on February 24, 2026 Pre-Market, with investors watching whether revenue near $145.37 million and adjusted EPS near $0.14 translate into improved profit metrics and management commentary that supports sustained growth into the next quarter.
Market Forecast
Consensus points to a solid top-line and earnings acceleration this quarter: revenue is estimated at $145.37 million, up 42.23% year over year, with adjusted EPS around $0.14, implying 43.36% growth; EBIT is projected at $28.57 million, up 60.73% year over year. Margin forecasts have not been disclosed, but the growth profile suggests operating leverage and a favorable mix could support profitability if cost inputs remain stable.
The main business remains system solutions, which delivered $110.40 million in the prior quarter and should continue to anchor shipments and incremental contribution. The most promising segment is system solutions, given its $110.40 million base and leading contribution, while company-level revenue grew 32.93% year over year in the prior quarter and is expected to rise 42.23% year over year in the current quarter.
Last Quarter Review
Shoals Technologies Group reported revenue of $135.80 million, a gross profit margin of 37.00%, GAAP net profit attributable to the parent of $11.88 million, a net profit margin of 8.75%, and adjusted EPS of $0.12, with year-over-year growth of 32.93% for revenue and 50.00% for adjusted EPS.
A key financial highlight was a revenue beat of $4.92 million versus the prior estimate, even as net profit decreased 14.26% quarter on quarter. On the business side, system solutions contributed $110.40 million, or 81.30% of revenue, and solar components contributed $25.40 million, or 18.70%, while company-level revenue advanced 32.93% year over year.
Current Quarter Outlook (with major analytical insights)
Core System Solutions
System solutions remain the core revenue engine, and the projected company-level revenue growth of 42.23% year over year implies this category will again lead volume and EBIT contribution. With last quarter’s gross margin at 37.00% and net margin at 8.75%, incremental profitability in the current period will depend on shipment timing, product configuration, and the balance between turnkey bundles and discrete offerings. If project deliveries land earlier in the quarter and production throughput remains consistent, cost absorption can support gross efficiency, enhancing the translation of revenue into EBIT and EPS.
The forecasted EBIT growth of 60.73% outpacing revenue growth underscores potential operating leverage, which is typically strongest when fixed manufacturing and overhead costs are spread over larger volumes. Mix within system solutions is also central: a richer content bundle generally carries better unit economics, while any shift toward lower-priced configurations can mute gross margin even when absolute revenue expands. Pricing discipline and stable input costs are pivotal; broader commodity inputs such as copper and aluminum can influence wiring and harness costs, and the ability to maintain pricing against these inputs supports margin resilience.
Execution on the delivery schedule is likely to be the deciding factor for quarter-to-quarter variability. Projects slipping into the next period can defer revenue and EBIT recognition, while smooth delivery cadence can compress the gap between revenue growth and margin realization. Against the backdrop of last quarter’s 31.08% year-over-year EBIT gain and 50.00% year-over-year growth in adjusted EPS, the current-quarter set-up implies that better absorption and efficient fulfillment in system solutions can sustain the targeted EPS trajectory near $0.14.
Solar Components
The solar components segment contributed $25.40 million last quarter, representing 18.70% of revenue. This category offers optional upside as attach rates and complementary sales into existing accounts improve, even though, on a relative basis, its profitability per dollar of revenue may trail system solutions given typical pricing and competitive dynamics for discrete components. If order intake supports a higher run-rate and cross-sell initiatives gain traction, this line can augment top-line momentum without materially compromising aggregate margin structure, provided discounting remains controlled.
One watchpoint is the degree to which higher component volumes are achieved through pricing concessions versus incremental volume at stable pricing. If growth in components requires pricing give-backs, any revenue benefit can be partially offset by lower gross margin. Conversely, if the company can drive components alongside core system solutions at consistent pricing, the blended margin should remain aligned with or modestly below the company’s historical 37.00% gross margin, depending on mix.
Operationally, inventory turns and logistics execution matter for this segment. Clean inventory positions help avoid aged stock and minimize write-down risk, while tight logistics mitigate freight spikes that can pressure margins. In aggregate, management’s ability to align component availability with delivery windows for system solutions can reduce rework and expedite revenue recognition, improving EBIT conversion.
Key Stock Price Swing Factors This Quarter
Guidance versus consensus will be the primary swing factor for the share price in the near term. With consensus revenue at $145.37 million and adjusted EPS near $0.14, any update on order conversion, shipment phasing, or backlog cadence that supports or surpasses these figures can reinforce the bullish setup implied by the 42.23% and 43.36% year-over-year growth projections for revenue and EPS. Conversely, indications of timing variance or temporary constraints in delivery readiness could create volatility, particularly given last quarter’s 14.26% quarter-on-quarter decline in net profit.
Margin commentary will also play an outsized role. Investors will focus on whether the company can maintain or improve upon the prior 37.00% gross margin and 8.75% net margin, or articulate a credible path to margin expansion as volume scales. Management color around product mix, pricing discipline, and input costs will help frame the sustainability of EBIT growth projected at 60.73% year over year; confirmation of stable material costs and efficient manufacturing throughput would support the EPS outlook.
Cash conversion and expense control are incremental swing factors. Indications that receivables, inventory, and payables are balanced to support shipment cadence can bolster confidence in free cash flow trajectory. At the same time, commentary on operating expense timing—particularly R&D and SG&A investments—will help investors gauge the durability of operating leverage in the face of expanding volumes. Together, these factors will shape whether near-term price action aligns with the bullish analyst stance and the current growth forecasts.
Analyst Opinions
The balance of recent views is bullish: across the last six months, the ratio of bullish to bearish opinions is 100% to 0%, with several well-known institutions maintaining positive stances ahead of the print. Needham’s Sean Milligan reiterated a Buy rating with a $12.00 price target, highlighting confidence in sustained revenue growth and execution. TD Cowen’s Jeff Osborne maintained a Buy rating and raised the price target to $11.00, citing improving financial performance and growth trajectory. Goldman Sachs, through Brian K. Lee, kept a Buy rating with an $8.00 target, signaling constructive expectations on revenue expansion and the ability to deliver against near-term targets.
These analysts’ views dovetail with the projected 42.23% year-over-year revenue growth and 43.36% year-over-year EPS growth embedded in current-quarter expectations. The bullish stance appears to be grounded in the pattern observed last quarter—revenue of $135.80 million that topped estimates by $4.92 million, a 37.00% gross margin profile, and adjusted EPS growth of 50.00% year over year—combined with the prospects for incremental operating leverage as volume scales. With EBIT forecast to increase by 60.73% year over year, the analyst community seems to anticipate that volume and mix can offset typical seasonal and cost variability, supporting an EPS around $0.14.
From a valuation and catalyst perspective, supportive guidance or evidence of continued order conversion could validate the higher price targets. The line of thinking behind these Buy ratings implies that the market may still be pricing in execution risk, and positive commentary around shipment timing, backlog conversion, and expense discipline could lead to estimate revisions. Conversely, should management signal that revenue phasing is shifting to a later quarter without a corresponding offset, near-term sentiment could soften even if the full-year growth trajectory remains intact.
In synthesizing these opinions, the majority view emphasizes the importance of stable margins and delivery cadence. The analyst community expects the company to translate strong top-line momentum into higher EBIT and EPS, provided pricing and input costs are managed effectively. For investors monitoring the upcoming report on February 24, 2026 Pre-Market, the alignment between the 42.23% revenue growth forecast, the 43.36% EPS growth projection, and reaffirmed Buy ratings sets a straightforward litmus test: delivery of the projected revenue scale with margin steadiness. Should those conditions be met, the prevailing bullish narrative is likely to remain intact and could potentially strengthen as the year progresses.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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