Actionable news
0
All posts from Actionable news
Actionable news in SUNE: SUNEDISON Inc,

SunEdison: Doubling Your Investment On A Heavily Discounted Stock

Summary

SUNE has dropped over 80% over the last 6 months due to poor performance in the energy sector and investor fears over the Vivint Solar acquisition.

With the ITC tax credit extension, strong industry growth, and a modified acquisition of the Vivint Solar deal, SUNE is poised to climb back.

I am projecting a ROI of 103% over the next 12 months.

Introduction

SunEdison (NYSE:SUNE) is a global renewable energy company determined to deliver clean energy solutions to homeowners and businesses, as well as provide electricity to international rural locations. It operates within the industry by servicing, manufacturing, and financing clean energy solutions.

The company has seen a huge decline in stock price over the last several months due to several factors, but is now trading at a huge discount. I am projecting that over the next 12 months, SUNE will increase to $12 per share, an increase of over 100%.

Catalysts

Tax credit extension. The first key catalyst for SUNE's sale growth is Congress' extension of the 30% federal tax credit for businesses and individuals that install renewable energy systems. This was a huge driver in gaining some immediate short-term traction and momentum until it was brought to an abrupt stop following Appaloosa Management's request for TerraForm Power's (NASDAQ:TERP) documents. The tax credit plays a huge role in the expected growth of the solar industry. Below is the growth of previous and future projections of solar installation with the expiration of ITC tax credit, which as you can see would have resulted in a 57% decline for 2017.

Source: Solar Energy Industries Association

Acquisition of Vivint Solar. Secondly, the tax credit extension makes SUNE's acquisition of Vivint Solar (NYSE:VSLR) look that much more appealing. As the industry heats up, companies will become consolidated and with Vivint Solar's huge growth rate and 12% market share of the U.S. residential market, it makes for an...


More