Solar equipment supplier Shoals Technologies Group (SHLS) plans to raise $1.6 billion with an initial public offering that's drawing heightened attention in a hot market. The Shoals IPO trades Wednesday.
With solar stocks trading near record highs, Shoals is offering 70 million shares at a price range of $22 to $23. It originally planned to offer 50 million shares at $19 to $21. The price and volume rise indicates strong interest among institutional investors.
Solar stocks have rallied since the election of President Joe Biden, who made green energy initiatives a big part of his campaign. In addition, the outlook for solar stocks is bolstered by investors speculating on an environmental infrastructure boom.
Based in suburban Nashville, Tenn., Shoals provides an array of gear needed to operate solar energy systems, according to the Shoals IPO filing. Moreover, it provides the components needed to carry electric currents from solar panels to solar inverters and ultimately to the power grid. This includes cable assemblies, wireless monitoring systems, junction boxes, transition enclosures, and splice boxes.
The full setup of gear is referred to as electrical balance of system, or "EBOS" solutions.
"EBOS components are mission-critical products that have a high consequence of failure, including lost revenue, equipment damage, fire damage, and even serious injury or death," the company said in its IPO filing. "As a result, we believe customers prioritize reliability and safety over price when selecting EBOS solutions."
For the nine months ended Sept. 30, Shoals reported revenue of $136.7 million, up 28% from the year-ago period. Net income was $29.5 million, vs. $17.3 million a year ago.
