ARRY · Array Technologies
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $6.68
Note written ·
Price against the kill line
27.5% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $6.68, on record since 11 November 2026. The shares are down 2.8% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $6.68, the 200-day average of adjusted closes as of 11 November 2026, would show the shares leading the S&P 500 and prove this call wrong; so would an S-4 that lifts combined 2027 revenue above the $2.4 billion top of the preliminary range.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 9 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 330
- Revenue, change on a year (%)
- −16.1
- Gross margin (%)
- 21.0
- Operating margin (%)
- 4.2
- Free cash flow, four quarters ($M)
- 112
- Net cash, cash less debt ($M)
- −519
- Enterprise value to sales (×)
- 1.1
- Free-cash-flow yield (%)
- 15.0
All filed numbers
What Array Technologies reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 330 | −16.1 | 21.0 | 4.2 |
| first filed | 342 | −5.6 | 29.1 | 10.2 |
| first filed | 223 | −26.1 | 28.2 | 3.2 |
| first filed | 226 | −17.9 | 8.6 | −65.5 |
| first filed | 394 | +70.0 | 26.9 | 11.6 |
| first filed | 362 | +41.6 | 26.8 | 12.8 |
| Pre-tax income ($M) | 9.8 |
| Net income ($M) four quarters: −111 | 8.2 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | 0.0 |
| Operating cash flow ($M) | 140 |
| Capital spending ($M) | 28.3 |
| Free cash flow ($M) | 112 |
| Cash and short-term investments ($M) | 143 |
| Debt ($M) non-current long-term debt plus current maturities | 662 |
| Net cash, cash less debt ($M) | −519 |
| Deferred revenue ($M) +13.7% on a year | 145 |
| Backlog, orders not yet delivered ($M) +30.4% on a year | 522 |
| Receivables ($M) | 330 |
| Inventory ($M) | 168 |
| Shareholders' equity ($M) | −208 |
| Market value ($M) | 747 |
| Enterprise value, market value plus net debt ($M) | 1,265 |
| Enterprise value to sales (×) | 1.1 |
| Enterprise value to operating income (×) | Not meaningful |
| Price to earnings (×) | Not meaningful |
| Price to book value (×) | Not meaningful |
| Free-cash-flow yield (%) | 15.0 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 27.9% of shares outstanding sold short, 6.6 days of average trading to cover, +12.9% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $0 | $0 |
The thesis
Array Technologies' shares are more likely to lag the S&P 500 over the next three months. They now trade on the all-stock merger with Shoals Technologies more than on Array's own solar-tracker business, and that business cut its 2026 guidance on 4 November 2026. The S-4 registration statement, which the companies expect to file with more financial detail by the end of 2026, then the two shareholder votes and a first-quarter-2027 closing decide whether the $2.2–2.4 billion combined 2027 revenue outlook holds.
The shares closed at $4.80 on 12 November 2026. They have swung between $4.73 and $5.86 since 5 November 2026, with daily moves of 8% to 10%. The price sits 60.8% below the 52-week intraday high of $12.23 set on 9 February 2026. It is also below all four analyst targets set after Array filed its third-quarter 10-Q on 9 November 2026. The market is pricing the guidance cut and the dilution to Array holders, and it gives little credit to the 2027 outlook.
BMO Capital raised its target to $7 on 12 November 2026 and kept a Market Perform rating (company news). It joins UBS at $5.50 (Neutral, 10 November 2026), RBC Capital Markets at $6 (Sector Perform, 9 November 2026) and Piper Sandler at $5 (Neutral, 9 November 2026). All four raised their targets after the deal, and none moved to a buy-equivalent rating. The rating is Low because the targets went up while the ratings stayed neutral, Array's own outlook came down, and the deal decisions that matter are months away.
Bullish and bearish views on Array Technologies, Inc.
The bull case on Array Technologies, Inc. (ARRY), in brief: the order book is at a record. The bear case: Array's own guidance came down.
Bull case
- The order book is at a record. Executed contracts and awarded orders reached $2.6 billion at 30 September 2026, up 42% year over year (Q3 2026 results, 4 November 2026).
- Shoals brings growth and margin. Shoals reported third-quarter 2026 revenue of $195.3 million, up 43.8% year over year, with a 31.9% gross margin (merger slides via Investing.com, 4 November 2026).
- The combined 2027 outlook is large. The companies gave a preliminary 2027 outlook of $2.2–2.4 billion in revenue and $410–480 million in adjusted EBITDA (earnings before interest, taxes, depreciation and amortization). They expect synergies above $100 million by year three (merger slides, 4 November 2026).
- Targets keep rising after the deal. BMO moved to $7 on 12 November 2026, UBS to $5.50 on 10 November 2026, and RBC to $6 and Piper Sandler to $5 on 9 November 2026 (company news via Benzinga and fiscal.ai). Finimize reported RBC's view that a broader product line could help cross-selling to solar developers and improve cash generation.
Bear case
- Array's own guidance came down. On 4 November 2026 the company cut 2026 revenue guidance to $1.34–1.40 billion from $1.4–1.5 billion. It cut adjusted EBITDA guidance to $190–210 million from $210–230 million and cited the timing of project deliveries (Q3 2026 results).
- The quarter missed on earnings. Third-quarter revenue fell 16% year over year to $330.2 million. Adjusted earnings per share (EPS) of $0.06 missed the $0.09 estimate, and Array posted a $7.92 million net loss to common stockholders (Benzinga, 4 November 2026).
- A tax-credit reserve hit margins. An $11 million non-cash reserve against a 2023 45X tax-credit receivable cut adjusted gross margin by about 330 basis points, to 22.8% (Q3 2026 results, 4 November 2026).
- Array holders become the minority. Shoals holders will own about 65% of the combined company, and Shoals CEO Brandon Moss will run it (merger announcement and Array 8-K, 4 November 2026).
- Preferred redemptions claim cash. Array will redeem $161.3 million of preferred stock at 93% of liquidation preference within 90 days of closing. It will redeem $156.3 million more at 96% in up to three instalments (InsideArbitrage, 4 November 2026).
- The deal faces a fairness probe. On 10 November 2026 the shareholder-rights firm Halper Sadeh LLC said it is investigating whether the merger is fair to Array holders (company news).
Price setup
The shares closed at $4.80 on 12 November 2026, down 5.0% over three months. The 52-week closing low is $3.15, set on 26 October 2026. The 52-week intraday high is $12.23, set on 9 February 2026. The price sits between the 50-day average of adjusted closes, at $4.07, and the 200-day average, at $6.65, both as of 12 November 2026.
The $5.86 close of 6 November 2026 is the high point since the merger announcement, and the shares would have to retake it to recover. The $4.73 close of 10 November 2026 is the low point of the same period. A close under it would leave the shares further below every post-10-Q analyst target, the lowest of which is Piper Sandler's $5.
In an all-stock merger, arbitrage funds commonly buy the target and sell the acquirer short. That keeps pressure on Array while the deal is pending, and Finimize reported that Shoals fell alongside Array in the selloff after the announcement. The latest SEC Form 4 filings, dated 28 September 2026, show option exercises by the CEO and three other officers on 24 September 2026, with shares withheld for tax at $3.93. They show no open-market sales.
Catalysts ahead
- ~31 December 2026 (est.): S-4 registration statement and joint proxy for the Array–Shoals merger, expected by the end of 2026. It sets the vote timetable and discloses the projections behind the $2.2–2.4 billion combined 2027 revenue outlook and the synergy target.
- ~26 February 2027 (est.): Array fourth-quarter 2026 report. It shows whether delayed project deliveries landed and full-year revenue came in within the $1.34–1.40 billion guidance.
- ~1 March 2027 (est.): Shareholder votes at Array and Shoals on the merger. Approval at both companies is required. A rejection would leave Array as a stand-alone tracker maker coming off a guidance cut.
- ~31 March 2027 (est.): Expected closing of the Shoals merger in the first quarter of 2027. Closing starts the synergy count and the $161.3 million preferred redemption window, and the ARRY ticker may be replaced.
What would change the view
A daily close above $6.68, the 200-day average of adjusted closes as of 11 November 2026, would show the shares leading the S&P 500 and prove this call wrong; so would an S-4 that lifts combined 2027 revenue above the $2.4 billion top of the preliminary range.
What it trades with
Until closing, Array and Shoals Technologies (SHLS) move together through the fixed exchange ratio of 1.6931 Array shares per Shoals share, so news at either company moves both. The shares also track the solar group. On 4 November 2026 the TAN solar fund beat the XOP oil-exploration fund by nearly 13%, its best day since 2022, after Democrats won Congress and crude fell (Benzinga, 5 November 2026). A renewed solar rally against oil producers would support the shares. A reversal of that gain would add pressure.
The evidence, claim by claim (8)
- Q3 2026 revenue was $330.2 million, down 16% year over year, against a $322.7 million estimate; adjusted EPS was $0.06 against a $0.09 estimate. Array Q3 2026 results; Benzinga 4 November 2026 · as of
- Executed contracts and awarded orders reached a record $2.6 billion, up 42% year over year. Array Q3 2026 results press release · as of
- 2026 guidance was cut to revenue of $1.34–1.40 billion (from $1.4–1.5 billion) and adjusted EBITDA of $190–210 million (from $210–230 million). Array Q3 2026 results press release · as of
- Shoals holders receive 1.6931 Array shares per share and will own about 65% of the combined company; closing requires both shareholder votes, regulatory approvals and Nasdaq listing authorization. Array Form 8-K, 4 November 2026 · as of
- The preliminary combined 2027 outlook is revenue of $2.2–2.4 billion and adjusted EBITDA of $410–480 million, with synergies above $100 million by year three. Array/Shoals merger slides via Investing.com · as of
- BMO Capital raised its Array price target to $7 and kept a Market Perform rating. Company news, 12 November 2026 · as of
- UBS raised its target to $5.50 (Neutral) on 10 November 2026; RBC Capital Markets raised to $6 from $5 (Sector Perform) and Piper Sandler to $5 (Neutral) on 9 November 2026. Benzinga and fiscal.ai, 9 November 2026 and 10 November 2026 · as of
- Halper Sadeh LLC announced an investigation into whether the Array–Shoals merger is fair to Array shareholders. fiscal.ai, 10 November 2026 · as of
Sources
- ARRAY Technologies Reports Financial Results for the Third Quarter 2026 · globenewswire.com ·
- Array Technologies, Inc. - Form 8-K - FY2026 · sec.gov
- Array, Shoals Q3 2026 slides: merger to unlock $100M+ synergies · uk.investing.com
- Array and Shoals to Merge in a $1.52 Billion Stock Deal · insidearbitrage.com ·
- Array And Shoals Pitch A Solar Merger, But Shares Fell · finimize.com
- ARRAY Technologies and Shoals plan to merge companies · solarpowerworldonline.com ·
- Array Technologies swings to Q3 2026 net loss of $7.92 million as revenue falls 16% to $330.21 million · rallies.ai
- Array Technologies Q3 2026 Earnings Call Transcript · benzinga.com
Related · shared themes
CHPT
ChargePoint Holdings
ChargePoint shares are more likely to lag the S&P 500 after a 102% three-month rally that outran a business guiding third-quarter revenue…
NXT
Nextpower
Nextpower beat and raised fiscal 2027 guidance to $4.2B–$4.45B revenue on 28 October 2026, and the shares closed at $104.89 on 9 November…
CSIQ
Canadian Solar
Canadian Solar's shares are more likely to lag the S&P 500 over three months: subsidiary CSI Solar's revenue fell 42.63% in the third…
ENPH
Enphase Energy
Enphase Energy's core residential business is shrinking faster than its transformer pivot can offset, so the shares are more likely to lag…