On Wednesday, Shoals Technologies Group (NASDAQ:SHLS) experienced a downgrade in its stock rating by Roth/MKM from Buy to Neutral. The firm also adjusted the price target for the company's shares to $8.00, a significant decrease from the previous target of $15.00.
This change comes in the wake of Shoals Technologies delivering a mixed first quarter and a weaker outlook for the second quarter, alongside a reduction in its recently issued guidance for 2024.
The company's bookings for the quarter were notably lower than expected, coming in at $75 million compared to the buyside expectations of approximately $160 million. The management of Shoals Technologies has attributed the underperformance to project timing issues, indicating that these challenges may persist in the near term.
The statement from the management suggests that the company's results will continue to be influenced by these timing factors.
In response to these developments, Roth/MKM has significantly lowered their estimates for Shoals Technologies. The new price target of $8.00 reflects a recalibrated valuation, accounting for the heightened downside risk to future earnings estimates. The firm has expressed that it will maintain a Neutral stance on the stock until there is an improvement in the company's outlook.
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