Zacks Investment Research downgraded shares of SunEdison Inc. (SUNE) from OUTPERFORM to NEUTRAL on March 17, 2015, with a target price of $25.00.
Although SunEdison reported dismal results in the fourth quarter of 2014, its higher energy sales remain a positive. We believe that its strength in the solar business will continue, driven by increasing global demand for solar energy. Moreover, the company will benefit from the divestment of its semiconductor business, enabling it to concentrate more on its core competencies. Furthermore, its recent partnerships and cost reduction initiatives are expected to expand margins. Nonetheless, the pricing environment and a highly leveraged balance sheet remain concerns. Moreover, as project development requires considerable time and investment, any delay or inability in selling these projects at desired prices could affect liquidity. Thus, currently we have a Neutral stance on the stock.
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