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PayPal Credit Expanding Across The Pond

In a bid to capture even more of the world’s digital wallet, the company has announced the first overseas expansion of its PayPal ( PYPL ) Credit business — essentially lending money to consumers at checkout. The move, announced Wednesday, will add pressure in the United Kingdom (where the feature was rolled out) to other payments options — such as Amazon.com ( AMZN ) and its offering. PayPal Credit will offer 0% interest during the first four months for purchase amounts of 150 British pounds and higher, afterward subject to the standard variable interest rate, which is 17.9% at publication time. Limits will depend on each person’s credit, which will take about 10 minutes. PayPal also faces competitive pressures from relatively new entrants into the digital wallet sector, Google with its Android Pay, and Apple ( AAPL ) Pay. Google is a unit of Alphabet ( GOOGL ). PayPal stock fell a fraction to 38.64 on the stock market today . The stock is finding support at its 50-day moving average, a positive move just when the stock needed one. Volume, though, has been lackluster as shares bounce back. The stock is still below a potential buy point. The company has an IBD Composite Rating of 93, where 99 is the highest. The U.K. is PayPal’s second largest market outside of the U.S., according to Mashable , which notes that of nearly 180 million active customer accounts, 22 million are located in the United Kingdom. The program began in 2014 as a pilot with limited availability. The marketing messaging the company is using — “ the future of money ” — is consistent with its global advertising push after its spinoff from eBay ( EBAY ) in 2015. Thus far the campaign has included the firm’s first-ever Super Bowl ad.

SunEdison Soars After Finding ‘Overly Optimistic Culture,’ Not Fraud

SunEdison ‘s ( SUNE ) retained counsel blamed a former employee for the bungled Vivint Solar ( VSLR ) acquisition but noted SunEd’s own top management forged “an overly optimistic culture” related to projected cash flow. The late 2015 audit wrapped up April 4, finding no material misstatements in SunEd’s historical financial statements and no evidence to support fraud or willful misconduct by management, according to an 8-K filed Thursday. SunEdison shot up 58% to 58.5 cents on the stock market today . SunEdison is still about 98% off their seven-year high above 33 touched on July 20, 2015, achieved after announced plans to acquire solar installer Vivint. Ex-Worker Cited For Wrongdoing Largely, the auditor blamed a former employee for the failed Vivint Solar deal. SunEdison was slated to buy the residential developer for an initial $2.2 billion price tag. Vivint Solar called off the marriage in March, citing SunEd’s financial stance. “The independent directors also identified wrongdoing by a former non-executive employee of the company in connection with negotiations over the termination of the Vivint Solar acquisition,” according to the filing. SunEdison said it fired the employee when it learned of the wrongdoing. The company acknowledged in an 8-K filing last month that the U.S. Securities and Exchange Commission is investigating it, and that the  Department of Justice has subpoenaed  its Vivint records. The auditor also found problems related to SunEdison’s cash forecasting and liquidity management practices. Those practices may have led SunEd to technically default on $725 million in second-lien loans last month unless its creditors allowed for extensions. Specifically, the auditor said SunEdison’s cash forecasting efforts lacked sufficient controls and processes, and certain assumptions underlying cash forecasts were “overly optimistic,” and “a more fulsome discussion of risks and adjustments” was warranted. Also, SunEd failed to respond appropriately when its forecasts flopped. The auditor recommended SunEdison implement an improved cash forecasting system and provide more transparency to the board regarding cash management practices. Hiring Ilan Daskal to succeed Brian Wuebbels as CFO is also a remedy, the audit found. TerraForm Global Sues SunEdison Wuebbels stepped down in March from his SunEd CFO role but will remain in his TerraForm Global ( GLBL ) and TerraForm Power ( TERP ) CEO positions. Last month, TerraForm Global tried to separate itself from its parent , saying “there is a substantial risk that SunEdison will soon seek bankruptcy protection.” Last week, TerraForm Global filed a claim against SunEdison and its top dogs, asserting breach of fiduciary duty and contract, as well as “unjust enrichment” by SunEdison related to its failure to drop $231 million in India projects to its yieldco. TerraForm Global had already prepaid the money and is now seeking relief. In the same claim, it argued sister yieldco TerraForm Power would be liable for the $231 million if SunEdison files a bankruptcy petition. Both TerraForms are also now out of Nasdaq compliance, having twice delayed their annual 10-K financial filings. TerraForm Power has until May 16, and TerraForm Global until May 31, to submit plans for how they will become compliant. Nasdaq can grant a 180-day extension, allowing both yieldcos until September to regain compliance or risk delisting. TerraForm Global stock fell 3% to 2.56 on Thursday. TerraForm Power stock lost 3.1% to 9.71.

4 Banking Stocks With Compelling Fundamentals, Bullish Charts

Earnings from large-cap, widely held financial stocks have made headlines this week, but whether or not they’re ready to start bona fide uptrends remains to be seen as many are still far off highs. But several banking-related sub-groups in IBD’s database are serving up compelling prospects with bullish charts that don’t get a lot of attention. IBD’s Banks-West/Southwest industry group has rallied 6.3% in the past five sessions compared to a 2% gain for the S&P 500. Headed into Thursday, the group ranked in the bottom half of IBD’s 197 industry groups after a 23% pullback. Several stocks sport high Composite Ratings, but many are small and thinly traded. But there are a couple of bright spots. San Francisco-based First Republic ( FRC ) broke out powerfully Thursday after reporting strong earnings before the open. Shares rose 3.5%, closing 2% above a 68.51 buy point. Quarterly profit jumped 28% from a year ago, and revenue growth accelerated for the second straight quarter, rising 21% to $554.8 million. It also raised its quarterly dividend 7% to 16 cents a share, giving it an annualized yield of 0.9%. Western Alliance Bancorp ( WAL ) is also acting well in the group. The stock extended gains Thursday after a breakout from a cup-with-handle base with a 34.46 buy point. Shares rose 27 cents to 35.44. Big revenue growth in recent quarters is a result of its acquisition last year of San Jose-based Bridge Capital Holding and Bridge Bank for $425 million. The buy gave Western Alliance a new growth opportunity in technology-related banking in the Silicon Valley. In its latest reported quarter, earnings rose 24% from a year ago with revenue up 36% to $160.8 million. For the current quarter, analysts expect revenue to increase 50% to $164.3 million. Earnings are due April 21 after the close. Meanwhile, the Banks-Midwest group is also serving up some interesting names. Missouri-based Commerce Bancshares ( CBSH ) is near a 45.91 cup-with-handle buy point on the heels of Wednesday’s earnings that showed accelerating earnings and sales growth, helped by strong gains in loans and deposits. Profit rose 12% from a year ago. Revenue also increased 12% to $291.1 million. Recent initiatives in the mortgage banking area are expected to boost results going forward. At first glance, Chicago-based PrivateBancorp ’s ( PVTB ) weekly chart shows a cup-with-handle base with a 40.28 buy point. But the handle comes up just short on the midpoint test. A proper handle should form in the upper half of a stock’s base. The midpoint of PrivateBancorp’s current base is 38.49. The midpoint of the handle is 38.27. Technically, that’s in the lower half but a breakout could still work. PrivateBancorp joined the S&P Midcap 400 in late February. Earnings are due April 21 before the open. It’s expected to report a fifth straight quarter of double-digit earnings growth.