The Inflection Economy
Portfolio Managers at Logos LP
Shoals sits closer to solar's real bottleneck than generation names like First Solar and Array. As cell efficiency keeps improving, highlighted by a singlet-fission result beyond the Shockley-Queisser limit, the constraint moves downstream to the grid, interconnection, storage and power equipment. The better trade is owning that chokepoint rather than every solar name. x.comÂ
Solar is shifting from a policy-driven ESG and multiple-expansion trade to an infrastructure story as fundamentals evolve, and that transition is not priced. If the group is turning, infrastructure names should win first: Shoals and Array Technologies show relative strength and look like two of the more interesting bottoming setups, with Sunrun also an interesting long. x.comÂ
Shoals Technologies is a buy, following an introduction and update shared over the prior two weeks. x.comÂ
First Solar is the only non-impaired Western solar manufacturer, yet the category leader trades at historically low multiples against its own past and relatively low multiples against basically everything else in the market. Buying it at those valuations is a gift; it looks like a dinger. x.comÂ
Solar is the cheapest energy source to build right now as its costs keep falling, making First Solar, Array Technologies, Shoals and the solar ETF the solar plays within the energy transition. Elon Musk says solar will eventually supply essentially all the energy humanity harnesses because the giant fusion reactor in the sky is free. x.comÂ
Solar equities stand to benefit as solar generation accelerates rapidly across Texas's ERCOT grid, becoming one of the state's fastest-growing electricity sources. The largest beneficiaries span the sector: NextPower's utility-scale trackers, First Solar's US-made thin-film modules, T1 Energy's domestic modules, Enphase's microinverters and storage, SolarEdge's inverters, Sunrun's residential solar, and HA Sustainable Infrastructure Capital's clean-energy financing. x.comÂ
First Solar has lost its appeal because of how its bookings have been trending, while power names Vistra and Talen look cheap. x.comÂ
Solar is becoming a national priority as the Trump administration reportedly plans a polysilicon price floor and tariffs, and solar may finally catch a bid. First Solar is the play here. x.com x.comÂ
LONGi's depressed valuation shows the market confusing short-term circumstances with structural trends, as falling battery and solar costs shift future transport toward EVs and renewables. Valero and LONGi sit at opposite ends of who will power future transport, and each one's present circumstances run opposite to its likely structural path. The market puts too much weight on the news, as Valero's swings from $120 in 2018 to $40 in 2020 and $422 now show. x.com x.comÂ
Bloom Energy solves power-development bottlenecks, a reason to own its shares. Object Zero lists land, permits, grid access, equipment, fuel security and community political power among the constraints, and says the remaining development sites keep getting worse. x.comÂ
First Solar looks overlooked, trading near a 2.5-year low relative to the solar sector it leads while that sector sits near a multi-year high. With oil this elevated, a top-quality solar name like First Solar should catch a bid, and its chart shows a potential mini inverse head-and-shoulders bottom. x.comÂ
AI power generation is now all about deployment speed, with a shortfall of about 38 GW through 2028, of which only about 15 GW will be met by the grid, per Morgan Stanley. Bloom Energy looks pricey at about 82x earnings, but a bull case of about $25B of 2030 revenue implies $16.70+ EPS and $668 at 40x. Gas winners include Howmet, GE Vernova, Caterpillar and Baker Hughes. Cheap solar plus batteries deploys in 18-24 months, favoring Nextracker, Shoals, Fluence, Tesla and Albemarle. x.comÂ
