SHLS
Shoals Technologies Group, Inc.
$10.76
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 62.8% above fair value
You pay
$10.76
Bear
$5.29
Fair
$6.61
Bull
$7.93
Bear
$5.29
-50.8%
$0.21 × 18x P/E
Fair
$6.61
-38.6%
$0.21 × 22x P/E
Bull
$7.93
-26.3%
$0.21 × 27x P/E
Key Value Driver
Normalized P/E multiple (22x base case)
Implied Market Multiple
50.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $12.00 from 23 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $6.61 per share.
Warnings
Wall Street's average price target is $12.00 (from 23 analysts). Our estimate is 60% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples