New US tariffs on imported solar panels and key components have turned a policy headline into a real money question for investors. Some stocks now face higher costs and squeezed margins, while others may gain an edge as supply chains adjust. This article explains how those shifts may affect different companies and highlights 3 stocks that appear more exposed to potential downside risk from these trade changes than to possible benefits.

Shoals Technologies Group (SHLS)

Overview: Shoals Technologies Group designs and manufactures electrical balance of system equipment that connects solar panels and battery storage projects to the power grid, supplying products like cable assemblies, combiners, disconnects and monitoring systems to large utility-scale developers and installers. The company mainly sells to engineering, procurement and construction firms, utilities, power producers and other solar and storage players across the U.S. and abroad.

Operations: Shoals generates all of its reported revenue, about $588 million, from electric equipment solutions for solar and battery storage projects.

Market Cap: $1.4b

Investors looking at Shoals Technologies Group now face a tougher story than simple growth headlines suggest. The business sits directly in the firing line of new U.S. solar tariffs that may squeeze project economics for its customers and slow volumes in the domestic market it leans on most. At the same time, Shoals is carrying high external borrowing, dealing with costly legal and warranty issues, and working through a mix shift toward lower margin products that could keep pressure on profitability. Recent factory expansion and a push into energy storage and data center power add to the company’s long-term potential, but the risk that earnings and cash flow underwhelm from here remains an important consideration.

Shoals Technologies Group’s tariff exposure, high borrowing and legal costs suggest the story may be more fragile than it looks. Before assuming the risk is priced in, review the 3 warning signs

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Sunrun (RUN)

Overview: Sunrun is a residential-focused solar company that designs, installs, owns and maintains rooftop solar and battery systems, selling power and equipment to homeowners while also operating virtual power plants that pool customers' systems to support the grid.

Operations: Sunrun generates about US$3.5b in revenue from providing solar energy services and products to customers in the United States.

Market Cap: US$2.3b

Sunrun draws interest because it sits at the center of the push for home solar and storage, yet the set up is far from comfortable for investors. New tariffs raise hardware costs for a business that relies on imported components, at the same time as management has warned on cash generation, subscriber value and installation volumes for 2026. The stock screens as cheap on earnings, but forecasts already point to shrinking profits and rising financing pressure for a capital intensive model that depends on external borrowing and securitizations. Storage attachment, grid services and even AI compute pilots may create future revenue streams, but the risk that policy changes, higher tariffs and funding costs erode those benefits is hard to ignore.

Sunrun’s low P/E and capital-hungry model can appear tempting, yet fragile once tariffs, funding costs and shrinking profit forecasts align. Get the full picture in the analysis report for Sunrun

Canadian Solar (CSIQ)

Overview: Canadian Solar is a global manufacturer and developer that sells solar panels, battery storage systems and related equipment, while also building and operating large solar and storage projects that supply electricity and services to utilities, businesses and households across multiple regions.

Market Cap: $1.0b

Canadian Solar sits in a tough spot for tariff focused investors. The stock looks inexpensive on sales while holding tier 1 recognition in both modules and storage and building out U.S. factories and utility scale storage contracts. Yet it is still reporting losses and relies fully on external borrowing at a time when new U.S. tariffs directly target its silicon based exports. Recent commentary from management highlights higher duties, policy uncertainty and pressure on module margins, even as the company leans into heavy capex for new U.S. cell and module plants. For investors, the tension between ambitious growth plans and fragile earnings leaves a lot riding on how quickly domestic manufacturing, storage projects and policy credits can offset the tariff hit.

Canadian Solar’s low sales multiple, heavy capex and tariff hit create a story that appears cheaper than it might actually be. Before assuming the risk pays off, read the 3 key rewards and 2 important warning signs (1 is major!)

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.