NEW YORK (TheStreet) -- SunEdison (SUNE) fell Thursday after the company announced the pricing of its offering of $500 million aggregate principal amount of 0.25% convertible senior notes due 2020 in a private placement.
SunEdison expects the offering to close on June 10. The offering includes a 30-day option for initial purchasers to buy an additional $100 million aggregate principal amount of notes. The company estimates net proceeds of approximately $487 million, or approximately $584.5 million if the initial purchasers exercise their option to purchase additional notes in full.
The stock was down 2.27% to $20.20 at 10:04 a.m.
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Separately, TheStreet Ratings team rates SUNEDISON INC as a "sell" with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate SUNEDISON INC (SUNE) a SELL. This is driven by some concerns, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, weak operating cash flow and feeble growth in its earnings per share."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 571.9% when compared to the same quarter one year ago, falling from -$91.80 million to -$616.80 million.
- The gross profit margin for SUNEDISON INC is rather low; currently it is at 19.98%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -112.86% is significantly below that of the industry average.
- Net operating cash flow has significantly decreased to -$215.20 million or 81.45% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
- SUNEDISON INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, SUNEDISON INC reported poor results of -$2.39 versus -$0.65 in the prior year. This year, the market expects an improvement in earnings (-$0.39 versus -$2.39).
- Compared to its closing price of one year ago, SUNE's share price has jumped by 169.02%, exceeding the performance of the broader market during that same time frame. Regarding the future course of this stock, we feel that the risks involved in investing in SUNE do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
- You can view the full analysis from the report here: SUNE Ratings Report