Market Overview - U.S. stocks showed mixed performance with the Dow Jones index declining by 0.35% to 44,249.09, while the NASDAQ increased by 0.07% to 20,427.63 and the S&P 500 fell by 0.03% to 6,228.39 [1] - Energy shares experienced a notable increase of 2.1%, while utilities stocks decreased by 1.9% [1] Used Vehicle Market - The US Manheim Used Vehicle Value Index rose by 1.6% month-over-month for June, following a 1.4% decline in May [2][11] Commodity Market - Oil prices increased by 0.3% to $68.14, while gold prices decreased by 1.1% to $3,306.90. Silver fell by 0.8% to $36.625, and copper dropped by 0.5% to $5.0000 [5] European Market - European shares showed positive movement with the eurozone's STOXX 600 rising by 0.40%, Spain's IBEX 35 Index up by 0.10%, London's FTSE 100 gaining 0.46%, Germany's DAX 40 increasing by 0.68%, and France's CAC 40 rising by 0.46% [6] Asian Market - Asian markets closed higher, with Japan's Nikkei gaining 0.26%, Hong Kong's Hang Seng climbing 1.09%, China's Shanghai Composite increasing by 0.70%, and India's BSE Sensex rising by 0.32% [7] Company News - ENDRA Life Sciences Inc. saw its shares surge by 134% to $8.10 after announcing a US patent for a "Radio Frequency Applicator" [9] - ProKidney Corp. shares surged by 218% to $1.95 following positive topline results from its Phase 2 REGEN-007 trial for chronic kidney disease and diabetes [9] - Humacyte, Inc. shares increased by 20% to $2.5750 after receiving Electronic Catalog Listing approval from the US Defense Logistics Agency [9] - Blue Gold Limited shares dropped by 21% to $58.75 after announcing the formation of its inaugural Advisory Board for Blockchain Evolution [9] - Sunrun Inc. shares fell by 11% to $9.84 after President Trump signed an executive order to end clean-energy tax credits [9] - Apogee Therapeutics, Inc. shares decreased by 8% to $36.24 following the release of data from its Phase 2 APEX clinical trial for atopic dermatitis [9]

Core Insights - Array Technologies, Inc. (ARRY) is currently outperforming its peers in the Oils-Energy sector with a year-to-date gain of approximately 30.5% compared to the sector average return of 1% [4] - The company holds a Zacks Rank of 2 (Buy), indicating strong analyst sentiment and an improving earnings outlook, with a 4.7% increase in the consensus estimate for full-year earnings over the past quarter [3] Company Performance - Array Technologies, Inc. is one of 241 individual stocks in the Oils-Energy sector, which is ranked 15 in the Zacks Sector Rank [2] - The company belongs to the Solar industry, which includes 15 stocks and is currently ranked 36 in the Zacks Industry Rank, with an average gain of 2.6% year-to-date [5] Comparison with Peers - Another notable stock in the Oils-Energy sector is FMC Technologies (FTI), which has returned 20.2% year-to-date but belongs to a different industry ranked 220, with a year-to-date decline of -10.5% [4][6] - The performance of Array Technologies, Inc. indicates a strong position within the Solar industry compared to the broader Oils-Energy sector and its peers [5][6]

Core Insights - Value investing remains a popular strategy for identifying undervalued stocks in various market conditions [2] - Zacks has developed a Style Scores system to categorize stocks, with a focus on the "Value" category for value investors [3] Company Analysis: Array Technologies (ARRY) - Array Technologies holds a Zacks Rank of 2 (Buy) and a Value grade of A, with a P/E ratio of 10.06 compared to the industry average of 17.02 [4] - The Forward P/E for ARRY has fluctuated between 5.23 and 12.17 over the past 52 weeks, with a median of 7.82 [4] - ARRY has a PEG ratio of 0.46, lower than the industry average of 0.76, with its PEG ratio ranging from 0.28 to 1.22 in the past year [5] Company Analysis: Shoals Technologies Group (SHLS) - Shoals Technologies Group also has a Zacks Rank of 2 (Buy) and a Value Score of A, with a forward earnings multiple of 14.79 [6][7] - The PEG ratio for SHLS is 0.62, compared to the industry average of 0.76, with its PEG ratio ranging from 0.29 to 0.72 over the past year [7] - SHLS has a P/B ratio of 1.79, while the industry average is 1.98, with SHLS's P/B fluctuating between 0.84 and 2.18 in the last 12 months [8] Overall Value Assessment - Both Array Technologies and Shoals Technologies Group exhibit strong value characteristics, indicating they may be undervalued in the current market [9]

Core Viewpoint - Solar stocks are experiencing volatility due to the passage of the "Big Beautiful Bill," which is impacting the energy sector [1]. Company Analysis - First Solar (NASDAQ: FSLR) is highlighted as a potential winner in the market following the Senate's approval of the bill [1].

Investment Ratings - The report maintains a "Sell" rating on Flat A/H, Xinyi Solar, and Tongwei, while it has a "Buy" rating on Longi [10][11][19]. Core Insights - The recent rally in share prices for Solar Glass and Poly is seen as an overreaction to supply-side policy expectations, with a noted average increase of 17% from June 30 to July 2 [1][2]. - There is an anticipated decline in demand for solar modules, with projections indicating a year-over-year decrease of 57% in China and 40% globally for the second half of 2025 [2]. - The report highlights the need for significant production cuts in the glass segment to balance supply and demand, estimating that a 30% cut is necessary given the current oversupply situation [5][6]. Summary by Key Sub-segments Poly - Poly inventory reached 140GW by the end of June, equating to four months of average demand, indicating significant oversupply [5]. - The report anticipates a 15% decline in poly prices in the second half of 2025 to 2026, driven by excess capacity [20]. Glass - A 30% production cut is deemed necessary to align supply with demand, with current monthly supply at 50GW against an average demand of 34GW [6]. - The report suggests that the industry may face prolonged margin pressure due to challenges in executing production cuts [6]. Module - Increased inventory pressure is expected to enhance the bargaining power of module manufacturers, leading to price discounts of 5%-10% on contracts for Poly and Glass [6]. - Longi is expected to maintain a relatively resilient profitability outlook due to anticipated upstream price cuts [7]. Company-Specific Insights Longi - Longi is rated "Buy" due to its potential EBITDA inflection in the second half of 2025 and superior mid-cycle return on equity (ROE) compared to peers [7][10]. - The 12-month target price for Longi is set at Rmb19.8, indicating a potential upside of 27.2% from the current price [10]. Xinyi Solar - Xinyi Solar is rated "Sell" due to a deteriorating industry landscape and structural margin pressures, with a target price of HK$1.9, reflecting a downside of 31.2% [11][12]. Flat A/H - Flat A/H is also rated "Sell," with a target price of Rmb10.3, indicating a downside of 39.1% [15][16]. Tongwei - Tongwei is rated "Sell" due to its high exposure to the Poly segment and anticipated structural margin pressures, with a target price of Rmb13, suggesting a downside of 27% [19][23].

Global Research ab 30 June 2025 First Read China Solar Industry People's Daily reiterates efforts to curb excess competition People's Daily of China advocates tackling involution competition On 29 Jun, People's Daily of China published commentary about reining in involution- style competition, especially in the solar, EV, and battery sector. It attributed the involution-style competition mainly to oversupply, lack of high market entry standards, and support from local government. Measures to address excess ...

Company Performance - Nextracker (NXT) stock increased by 1.65% to $58.51, outperforming the S&P 500 which gained 0.8% [1] - Over the past month, NXT shares rose by 3.51%, lagging behind the Oils-Energy sector's 3.8% gain and the S&P 500's 5.12% increase [1] Upcoming Financial Results - Nextracker is expected to report earnings of $1.03 per share, reflecting a year-over-year growth of 10.75% [2] - Projected revenue for the upcoming release is $867.15 million, indicating a 20.45% increase from the same quarter last year [2] Full-Year Estimates - Zacks Consensus Estimates forecast earnings of $3.87 per share and revenue of $3.33 billion for Nextracker, representing year-over-year changes of -8.29% and +12.56% respectively [3] - Recent analyst estimate revisions are important as they reflect near-term business trends and indicate analysts' optimism regarding Nextracker's operations [3] Zacks Rank and Valuation - Nextracker currently holds a Zacks Rank of 3 (Hold), with the consensus EPS estimate having increased by 0.31% over the last 30 days [5] - The company has a Forward P/E ratio of 14.89, which aligns with its industry's Forward P/E of 14.89, and a PEG ratio of 1.25, compared to the Solar industry's average PEG ratio of 0.52 [6] Industry Context - The Solar industry, part of the Oils-Energy sector, has a Zacks Industry Rank of 147, placing it in the bottom 41% of over 250 industries [7] - Research indicates that industries in the top 50% outperform those in the bottom half by a factor of 2 to 1 [7]

Stock Performance - Enphase Energy was the best-performing stock in the S&P 500 [1] Policy Impact - Reports suggest Congress may not cut federal tax incentives for residential rooftop solar installations [1]

Investment Rating - The report assigns a "Buy" rating to Longi and "Neutral" ratings to Daqo and Xinjiang Daqo New Energy, while TZE and Tongwei are rated as "Sell" [28][17][20]. Core Insights - The profitability inflection for the solar industry is expected to be delayed due to slower demand growth, with normalized earnings projected to remain low. The industry is anticipated to reach a cyclical bottom in 2025E, with a demand growth slowdown in China expected to average +6% CAGR from 2025E to 2030E, compared to +55% from 2020 to 2024 [1][15]. - The report highlights that the solar industry's capacity utilization is expected to decline to 59% from 2025E to 2030E, which is 15 percentage points lower than previous estimates. This is attributed to existing capacity cuts and a deceleration in demand growth [10][15]. - The report emphasizes the importance of a healthy balance sheet and strong R&D capabilities for companies navigating the cyclical bottom of the industry [1][14]. Industry Capex Trend and Capacity Addition - Capex spending in the solar industry is projected to decline further, with a forecasted -55% year-over-year decrease in solar capex for 2025E, compared to a previous estimate of -34% [2]. - The report notes that 30GW of module capacity has been terminated, including 15GW by Longi, and 12GW of module capacity has been delayed from listed players [2]. Demand Dynamics - Solar demand growth is expected to slow significantly, with a projected 25% decrease in global demand from 2026E to 2030E compared to previous estimates. This is primarily due to new regulations that limit on-grid access for large-scale solar projects and remove guaranteed on-grid volumes and prices for renewable projects [7]. - The report anticipates a rebound in China’s demand by 14% year-over-year in 2027E after a decline of -17% in 2026E, driven by better economics for commercial and industrial battery energy storage systems [7]. Capacity and Utilization - The report estimates a 17% cut in end-2024 module capacity by the end of 2026E, influenced by market access constraints and cash burn [3][10]. - The capacity utilization in China is projected to be 53% in 2025E and 52% in 2026E, with a slight recovery to 59% by 2027E [8]. Company-Specific Insights - Longi is highlighted as a leading integrated module player with strong R&D capabilities, expected to benefit from upstream price contractions and improved ROE due to Back Contact technology [16][17]. - TZE is rated as "Sell" due to anticipated headwinds from a shrinking addressable market and a stretched balance sheet amid aggressive downstream investment plans [19][20].

Summary of Shoals Technologies Group (SHLS) Conference Call Company Overview - **Company**: Shoals Technologies Group (SHLS) - **Industry**: Clean Energy, specifically Solar Energy Solutions Key Points and Arguments Demand and Market Activity - Demand for solar projects remains very strong, with many EPC (Engineering, Procurement, and Construction) customers having full project pipelines [4][5] - The solar industry has adapted to ongoing challenges such as labor availability, supply chain issues, and permitting delays [6][7][8] Regulatory Environment - The regulatory environment is currently volatile, with changes in tariffs and investment tax credits (ITC) creating uncertainty [10][11] - The availability of ITC is expected to phase out, which could increase costs for solar projects, but demand for energy remains strong [12][13] - The company does not participate in the 45X manufacturers credits but remains optimistic about its business model [14][15] Foreign Entity of Concern (FIOC) Provision - The FIOC provision may favor Shoals by limiting competition from foreign entities, particularly from China [16][18] - Shoals manufactures all eBOS (electrical balance of systems) solutions in the U.S., positioning itself well in a domestic-focused market [17][18] Competitive Landscape - Shoals differentiates itself from competitors by offering manufactured solutions that are tested for quality, unlike insulation piercing connectors (IPCs) that require field installation [20][22] - The company is working to educate developers on the long-term benefits of its solutions compared to IPCs [25][28] Master Supply Agreements (MSAs) - Shoals has secured significant MSAs, including a 12-gigawatt deal with Blattner and a 12-gigawatt deal with UGT for international projects [29][30] - MSAs provide predictability for project timelines and supply chain management, allowing for better investment in facilities and growth [31][32] International Expansion - Shoals is targeting international markets, including Australia and Saudi Arabia, while also responding to U.S. customer demands for global projects [38][40] Warranty Issues - The company is addressing warranty issues related to defective wire and is on track to complete remediation work this year [41][42] Data Center Demand - There is a growing demand for energy driven by data centers, which is expected to continue in the coming years [45][46] - Shoals is exploring ways to adapt its products for data center applications [47] Gross Margins and Financial Outlook - The company targets gross margins in the mid-30s to high-30s percentage range in the near term, with a long-term goal of exceeding 40% [49][52] - Shoals is focused on maintaining operating profits and cash flows while managing expenses [51][54] Capital Allocation and Growth Strategy - The primary focus is on organic growth, with potential for inorganic acquisitions to enhance product offerings [60][61] - Share repurchases are also considered, but the priority remains on business growth and facility investments [62] Additional Important Content - The company is expanding its involvement with developers to ensure long-term benefits of its products are recognized [36][37] - Shoals is actively working on battery energy storage solutions, which are becoming increasingly important in solar projects [56][58]