MeritValue

Shoals Technologies Group, Inc.

SHLSdata completeness 88%7 fiscal years on file
The thesis, from the filings

Shoals Technologies Group, Inc. earns about 8% on invested capital, below its ~9% cost of capital, but has diluted owners by 70% over 5 years — no moat visible in the numbers. The estimate methods put fair value between $2.07 and $25.54 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$213.2M1$326.9M2$488.9M3$399.2M3$475.3M3
Net income$2.35M4$127.6M5$40M6$24.1M6$33.6M6
Operating cash flow−$4.08M7$39.5M8$92M9$80.4M9$17.1M9
Capital expenditure$4.13M10$3.15M11$10.6M12$8.39M12$33M12
Free cash flow (derived)−$8.21M7$36.3M8$81.4M9$72M9−$16M9
Total debt$494.1M13$478.1M14$362.9M15$283.5M15—
Cash & equivalents$5.01M16$8.77M16$22.7M17$23.5M18$7.32M18
Diluted shares99.3M167.6M164.5M168.7M168.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$35.63
your share of equity
Profit it earned you last year
$1.99
Free cash flow it threw off
−$0.95
Debt you’d be carrying
—

10 shares is a claim on $35.63 of net worth that earned you $1.99 and generated −$0.95 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
8% avg · 5y
FY21 4%FY22 21%FY23 7%FY24 3%FY25 6%

It earned about 8% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
+70% shares · 5y

Share count is up 70% over 5 years — owners have been diluted. Worth asking what they got for it. Total debt has fallen 43% — deleveraging.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $2.07 and $25.54 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$25.54
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth20.0%
  • fcfBase$72M
DCF · Growth Exit 5Y
$13.98
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth20.0%
  • fcfBase$72M
Earnings Power Value
$2.07
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$33.6M
  • growthAssumed0.0%
Graham Number
$4
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years20.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $13.98
The three cases
Bear0.0%$6.15
Base20.0%$13.98
Bull20.0%$13.98

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 20.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001831651-24-000011 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001831651-25-000019 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001831651-26-000021 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001831651-24-000011 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001831651-25-000019 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001831651-26-000021 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001831651-24-000011 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001831651-25-000019 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001831651-26-000021 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001831651-24-000011 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001831651-25-000019 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001831651-26-000021 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001831651-23-000024 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0001831651-24-000011 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0001831651-25-000019 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2021-12-31 · accession 0001831651-24-000011 (CashAndCashEquivalentsAtCarryingValue)
  17. 10-K · period ending 2023-12-31 · accession 0001831651-25-000019 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2024-12-31 · accession 0001831651-26-000021 (CashAndCashEquivalentsAtCarryingValue)