Is Shoals Technologies Group, Inc. overvalued or undervalued?

As of 28 November 2025, the valuation grade for Shoals Technologies Group, Inc. moved from expensive to very expensive. The company appears to be overvalued based on its current financial metrics. The P/E ratio stands at 45, significantly higher than peers like Amkor Technology, Inc. with a P/E of 23.85 and Cirrus Logic, Inc. at 17.26. Additionally, the EV to EBITDA ratio is 17.05, while its closest peer, MACOM Technology Solutions Holdings, Inc., has a much higher EV to EBITDA of 50.14, indicating a stark contrast in valuation.
Despite a strong year-to-date return of 51.72% compared to the S&P 500's 16.45%, the overall valuation metrics suggest that Shoals Technologies is not a compelling investment at its current price of 8.39. With a return of 59.51% over the past year, it has outperformed the S&P 500, but the elevated valuation ratios indicate that this performance may not be sustainable, reinforcing the conclusion that the stock is overvalued.