Tag Archives: request

SunEdison Torched As Banks Pull Vivint Solar Funds; Dividend Cut

Vivint Solar ( VSLR ) could join Appaloosa Management in suing SunEdison ( SUNE ) over the former’s pending — and imperiled — acquisition by SunEd, a Credit Suisse analyst suggested Thursday, as at least two other investment banks downgraded SunEd stock. SunEdison shares ping-ponged this week amid rumors that banks are balking at issuing the $1.2 billion needed to finance the Vivint Solar acquisition. This week, SunEdison delayed its 10-K filing and suspended a popular dividend program. Needham and Macquarie both downgraded the stock Thursday. In the long term, suspending SunEd’s 6.75% perpetual convertible preferred stock could save $8.3 million per quarter, Credit Suisse analyst Patrick Jobin wrote in a research report. But Thursday was another bad day for the shares, down more than 13% in midday trading on the stock market , near just 1.55. SunEd fell 12% and 24% on Monday and Tuesday, respectively, but rose 19% Wednesday. Shares of SunEd yield company TerraForm Power ( TERP ) and Vivint Solar were down 3.5% and more than 1%, respectively. SunEdison Cash Crunch Expected Company-specific uncertainty — not solar industry uncertainty — prompted Needham analyst Edwin Mok to downgrade SunEd stock to hold from buy. “We now believe SunEdison could face an even greater cash crunch ahead, preventing the company from reaching the important goal of operating cash flow positive,” Mok wrote in a research report. Although SunEd obtained financing in January, “it appears SunEdison is facing mounting financial challenges, with a sharp rise in cost of capital which could ultimately cripple the future prospects of the company,” he wrote. Looming capital cost increases have plagued the solar industry this year. No. 1 residential installer SolarCity ( SCTY ) has shaved 60% off shares this year on that worry. IBD’s 22-company Energy-Solar industry group is down 25% this year. SunEd’s outlook is further complicated by a liquidity question, Mok wrote. In January, SunEd said it had $619 million in cash at the end of Q4. Of that, $56 million was not committed to the project business. Cash Questions Delay 10-K On Tuesday, SunEd delayed its 10-K filing to investigate those cash claims. Banks have balked at financing the Vivint Solar deal without updated financials, according to the Wall Street Journal. And SunEdison can’t finance Vivint Solar on its own, Mok and Jobin wrote in separate reports. Jobin suggested a Vivint Solar breakup — worth a $34 million fee — would help SunEd preserve some short-term cash. SunEd has until March 18 to close the deal before opening itself to a specific performance lawsuit by Vivint Solar. Vivint also could terminate the deal before then. That’s unlikely, though, considering Vivint Solar’s shareholders “overwhelmingly” approved the bid on Feb. 24, Jobin wrote. Last month, Appaloosa sued to prevent SunEd from dropping Vivint Solar’s debt-laden rooftop portfolio down to yield company TerraForm Power. Appaloosa has a 9.5% stake in TerraForm Power. A judge tossed Appaloosa’s injunction request last week. Image provided by Shutterstock .

Stratasys Q4 Beats But Shows Ongoing Struggles In 3D Printing Field

Working through a restructuring in a tough market, 3D printer maker Stratasys ( SSYS ) early Thursday reported a Q4 loss and big drop in revenue that nevertheless beat expectations on the top and bottom lines. Q4 revenue fell 20% from the year-earlier quarter to $173.4 million, but that beat the analyst consensus estimate of $169.3 million. It marked the second quarter in a row of declining revenue. The company reported a net loss of $232.3 million, or $4.46 per share. When adjusted for one-time items, Stratasys reported a loss of 1 cent, vs. consensus estimates for an 11-cent loss, as polled by Thomson Reuters. Stratasys stock was up 12.5%, near 23, in midday trading in the stock market today . Stratasys is up 55% since hitting an all-time low of 14.88 on Jan. 26. 3D printer stocks have rebounded in the past month-plus after suffering sharp drops. 3D Systems ( DDD ) stock was up 5% midday Thursday, near 12.40, after hitting its all-time low of 6 on Jan. 20. ExOne ( XONE ) was up 5.5%, near 11, and  Voxeljet ( VJET ) stock also was up 5.5%, near 5.25. Shares of Stratasys and 3D Systems, the two industry leaders, have been crushed since mid-2014, as both have posted disappointing quarterly earnings reports going back more than a year. For 2016, Stratasys guided to revenue of $700 to $730 million, up 3% at the midpoint. Analyst consensus is $700.6 million. It expects EPS ex items of 17 cents to 43 cents, vs. the consensus of 18 cents. Analysts have not been convinced of a rebound in the 3D printing industry. “There are no signs of a broad-based recovery yet, in our view, so demand commentary from Stratasys will be important,” wrote Weston Twigg, an analyst at Pacific Crest Securities, in a research note prior to the Stratasys report. “An industry rebound is not yet visible amid weak global capital spending trends,” Cowen analyst Robert Stone wrote, also before Stratasys earnings. During the quarter, Stratasys said it cut its workforce by 10% and “initiated programs to reduce operating expenses and optimize manufacturing.” In its earnings release, Stratasys said it can achieve a significant improvement in its operating structure in 2016 that will translate into improved operating profit compared with 2015. “Our fourth-quarter results reflect the impact of a market environment that is consistent with conditions we have observed throughout the year,” CEO David Reis said in the earnings release. “We are making progress in optimizing our company’s cost structure and improving working capital management, and were satisfied to observe a favorable trend in operating expenses and positive cash flow from operations during the quarter.”

Apple iPhone Socked As Smartphone Market Hits The Brakes

Smartphone shipment growth is projected to drop into the single digits worldwide this year, led by China’s transition from developing to mature market, research firm IDC said Wednesday. Apple ’s ( AAPL ) iPhone is likely to be much harder-hit than handsets using Alphabet ’s ( GOOGL ) Android operating system, IDC said. It sees iPhone shipments declining 0.1% in 2016, while Android phone shipments rise 7.6%. IDC predicts that total smartphone shipments will rise 5.7% to 1.5 billion units in 2016. Last year, smartphone shipments rose 10.4% to 1.44 billion units. IDC forecasts that Android smartphones will make up 82.6% of shipments in 2016, with 1.25 billion units. It projects Android smartphone shipments will grow at a five-year compound annual rate of 6.9% and reach 84.6% market share in 2020. Meanwhile, Apple’s iPhone will account for 15.2% of smartphone shipments in 2016, with 231 million units, IDC said. The research firm estimates that iPhone shipments will grow at a five-year compound annual rate of 3% and slip to 14% market share by 2020. Overall smartphone shipments are seen hitting 1.92 billion units in 2020, with volumes continuing to shift to lower-cost handsets. The average selling price for a smartphone is forecast to drop to $237 in 2020 from $295 in 2015, IDC said. Mature markets like the U.S., Western Europe and China all hit single-digit growth in smartphones in 2015, while high-growth emerging markets such as India, Indonesia, the Middle East and Africa, and other pockets of Southeast Asia all remained healthy. “The mature market slowdown has some grave consequences for Apple, as well as the high-end Android space, as these were the markets that absorbed the majority of the premium handsets that shipped over the past five years,” IDC analyst Ryan Reith said in a statement. “I believe Apple’s move into the trade-in business with its ‘Trade Up with Installments’ program is aimed at further increasing churn in some of its most lucrative markets despite the high penetration rates. By entering this space, Apple can more tightly control the trade-in offerings, as well as monitor the demand for where these perfectly functioning one-year old iPhones end up. The latter is just as important as the trade-in location, as it will give Apple a strong pulse on areas of high demand but perhaps less disposable income.” Large-screen smartphones, or phablets, continue to be a growth segment of the market. Phablets accounted for 20% of smartphone volumes in 2015 and are forecast to reach 32% of shipment volumes in 2020, IDC said. Apple’s iPhone sales to end users fell for the first time ever in the fourth quarter, research firm Gartner reported last month . Apple has projected that its iPhone sales into the sales channel will drop on a year-over-year basis for the first time this quarter. Image provided by Shutterstock . RELATED:  Apple Working On Dual-Camera iPhone 7 Plus Smartphone: Analyst .