Credit Suisse Downgrades SunEdison Amid 'Increased Uncertainty'

• The share price of Sunedison Inc SUNE has plummeted 92.96 percent over the past one year, to trade almost at its 52 week low on February 12, at $1.41.
• Patrick Jobin of Credit Suisse has downgraded the rating on the company from Outperform to Neutral, while lowering the price target from $19 to $3.
• The downgrade in the rating is based on increased uncertainty regarding the company’s near term liquidity profile.

Anlayst Patrick Jobin mentioned that Sunedison has announced on February 18 that it had “reached an agreement to restructure the polysilicon business (including a net cash outflow of $119m).”

In addition, Hawaiian Electric Industries, Inc. HE has announced its decision to cancel three PPAs with Sunedison due to the latter company having missed milestones that could lead to the reinstatement of debt up to $215 million due April 1.

The Appaloosa injunction order seeking to block the acquisition by TerraForm Power Inc’s TERP of the residential solar assets of Vivint Solar Inc VSLR “is still ongoing and presents another potential overhang, as we have written, in addition to the LAP litigation seeking $150m,” Jobin stated.

Jobin believes that the company has tried to move too rapidly, looking for “hyper growth” during a period when capital markets have been more challenged, thereby constraining its balance sheet.