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I wrote part 1 of my thesis on solar as a sector on another subreddit, but I don’t think people were interested in reading the research as much there :(. I broke down the trend we’re seeing with additional utility-scale generating **solar** capacity being brought on by U.S. developers and power-plant owners, how solar had one of the largest power generation requests based on Texas ERCOT’s February 2026 generator-interconnection queue, how California has already shown the possibility with solar and much more. If you’re interested in the detailed research you can find it on my page easily or not (totally up to you).
In this post I wanted to share with you guys (cause I think people actually appreciate reading and understanding the research here more) which solar names I’m interested in and why.
# Potential Good Risk-to-Reward Exposures (In My Opinion)
One thing to note about the case I’m making here is that I’m not claiming “Solar will power data centers.” My claim is specifically, “Data center load growth is forcing the U.S. power grid to add capacity quickly, and solar + battery storage should capture a significant share of that incremental capacity.” With this distinction made, we can determine the supply chain:
\- Utility-scale solar
\- Battery storage
\- Electrical balance of systems
\- Grid interconnection
\- Domestic manufacturing
\- Power electronics
\- Transformers, switchgear, cabling, and substation infrastructure
\- Behind-the-meter and near-site power systems for hyperscalers
Last year my best picks in this supply chain were battery storage players. I bought $ENS at \~$120/sh and $AMPX at \~$9/sh. Both those plays have done quite well and I still continue to like both of them, but in terms of solar specific names the two names I like are, $SHLS and $TE. Let’s talk about why…
# Shoals Technologies
Shoals Technologies is not just a solar-panel story. They sell Electrical Balance of System (EBOS) infrastructure. This includes the components that move current from solar panels to inverters and ultimately to the grid. Shoals describes EBOS as mission-critical infrastructure, including cable assemblies, fuses, combiners, disconnects, recombiners, wireless monitoring, junction boxes, and their plug-and-play system architecture.
In the last quarter (Q1 2026), they reported almost 75% revenue growth YoY, $140.6 million, from $80.4 million. Adjusted EBITDA rose to $21.1 million, and backlog plus awarded orders reached a record $758 million, up 17.5% YoY. Management guided Q2 revenue to $150–170 million and raised full year 2026 guidance to $600–640 million of revenue and $118–132 million of adjusted EBITDA. This imo is the cleanest evidence of my original thesis and I think a really good exposure. It shows, in my view, that solar and a solar company can grow even through the political noise.
Their data center angle is what’s attractive to me. Shoals says their solutions support utility-scale solar, battery storage, and data-center power systems, and they market their prefabricated plug-and-play architecture as useful for mission-critical infrastructure. The reason this matters is that data-centers are becoming more like utilities when it comes to power in my view. They need large electrical yards, battery systems, high-current DC architecture, rapid deployment timelines, and extreme reliability requirements. EBOS, I believe, is directly relevant wherever large solar and storage systems are being built to support data center load.
Their current enterprise value is \~$1.85B, and the stock trades roughly at 3x sales, \~15x forward EBITDA, \~19x trailing EBITDA and with \~$170M in debt. Using peers as benchmark, $NXT trades at \~28x, $APH trades at \~27x, and $ARRY trades at \~18x, trailing EV/EBITDA. With the specialized niche they offer with EBOS and the 50-70% guided revenue growth, backlog converts, stabalizing tariffs, and margin recovery, $SHLS looks like a good risk-to-reward play for me to express my solar thesis.
The main risks in my opinion are: gross margin pressure, tariffs, legal/warranty overhangs, project timing, competition, customer concentration, and whether data center demand translates into actual orders rather than just broader sector demand.
# T1 Energy
T1 Energy is a different and very interesting kind of bet, in my opinion. This is a crowd favorite name, recently Leupold disclosed his stake in it too. T1 is trying to build an integrated U.S. solar and battery supply chain. They operate the G1 Dallas solar-module facility and is pursuing vertical integration, including domestic solar-cell manufacturing.
In Q1 2026, they reported $177.6 million of net sales, up from $53.5 million in the prior year period. Management maintained 2026 G1 Dallas production guidance of 3.1–4.2 GW and said customer demand for G1 and G2 production in 2027–2028 covered more than 100% of their planned capacity.
The G2 Austin cell facility is the strategic asset for them in my view. They’ve said that Phase 1 is designed for 2.1 GW of solar cell production, with initial cell production targeted for Q4 2026. If successful, I think it would reduce reliance on imported cells, improve domestic positioning, and potentially make T1 more valuable under U.S. supply chain and tariff regime.
They announced acquisition of KORE Power which I think gives them exposure to data centers and battery storage. They’ve said that KORE gives them an entry point into BESS integration, software, and a renewables & infrastructure division that has supported more than 1,100 BESS projects globally. They expect the acquisition to contribute $15–20 million of EBITDA in 2027, assuming the deal closes and performs as expected. This is a plausible pivot that makes them interesting to me. Solar modules alone are more commoditized, but solar + domestic cells + energy storage integration + data center infrastructure says a much better story in my opinion.
But there are risks here. T1 energy is capital intensive, manufacturing execution is not the easiest of tasks, and the balance sheet is a bit complicated. As of Q1 2026, T1 reported $123.7 million of cash, cash equivalents, restricted cash, and restricted cash equivalents, but only $46.4 million of that was unrestricted cash. They also had meaningful debt and liabilities in my opinion.
So $TE is not a simple “solar is undervalued” story. I view them closer to an industrial policy/manufacturing ramp with meaningful operating leverage. If G1 ramps, G2 qualifies, customers convert, and KORE gives credible storage exposure, the upside can be meaningful, in my opinion. The risks here are finances tightening, policy shifts further against domestic credit monetization, and/or manufacturing margins disappoint. This, in my view, is definitely a higher-beta and more speculative story than $SHLS, but for me I like the risk-to-reward.
With that I thank you for reading my thoughts and opinions. I’m typically a micro-economic guy, meaning I post about individual stocks and sectors that I think are interesting. I tend to do a lot of research (more than what I posted here) and build my conviction. I hope this research helps you understand these industries better, and gives you an insight on how I look at equities/investments.
Please remember that I can be wrong and make mistakes. I am a human, I do often miss key facts and once they are know I will change my views. Please do not use this as financial advice. This is NOT FINANCIAL ADVICE! I’m just some guy on the internet who likes to research companies and industries. You should use what I write here as educational or entertainment, nothing else. I’m not a financial advisor. Do your own research before making any investments.