Avondale Still Holds $7-$8 Price Target On Sunedison, Says It's Based On 50% Discount To Peer EV/EDITDA

Shares of Sunedison Inc SUNE sold off sharply on Tuesday, following negative commentary from Axiom's Gordon Johnson.

"Given the number of deals and the type of deals that they've done," Johnson said Tuesday morning. "If they're unable to sell those projects, I don't know how much longer the equity can last."

When asked if Sunedison's new financing deal was a good move, Johnson said, "Absolutely not. I think this deal makes me more cautious on the company’s ability to make it through 2016."

See Also: Axiom's Gordon Johnson 'More Cautious' On Sunedison's Ability To Make It Through 2016

On Tuesday afternoon, Benzinga spoke with Avondale Partner's Michael Morosi. The analyst said his $7-$8 price target is based on 50 percent discount to peer EV/EBITDA. He views Sunedison's two-year debt maturity extension as a positive, noting that this bought the company more time.

Sunedison management reportedly told Avondale it is in a better position today than it was last week thanks to its recent capital raise.

Shares of Sunedison traded recently at $2.74, down 17.9 percent on the day. The stock was trading in the high $20s last summer.

Garrett Cook contributed to this report.