SunEdison (SUNE)

[Guest singular]

I am amazed that GTAT is up 17% today on the numbers they gave. I can't wait until the big 3 report.

[odyd 1,268]

Particularly that Applied had delivered weak forecast for equipment, based on this PV-Mag article,

http://www.pv-magazine.com/news/details/beitrag/solar-manufacturing-equipment-sales-lag-the-boom_100014317/#axzz2uH603CaY

I would say GTAT is getting Apple benefits more than anything

[Guest pgo]

Well the short interest is fueling it big time. Days to cover is 5+ which is high. 

[Scsnospam 117]

Anyone looking at gtat here after their report? If sapphire is the next gorilla glass for phones, plus new capital cycle for solar starting later this year, could be an interesting play.

[Guest pgo]

Not sure if anyone has seen this video.. but it shows how GTAT Merlin technology cuts down the cost. Anyone knowledgeable in PV manufacturing process care to comment how useful it is? Do you see any of our cost leaders like JKS using this to further reduce module manufacturing costs?

 

 

Also, following video talks about how Hyperion would bring cheaper Sapphire in the market for various applications including that of AAPL device. 

 

[Guest eysteinh]

Not really that big deal imho. It is just a combination of copper and silver tabbing and stringing. This is not revolutionary at all. There are several other solutions that can make good tabbing/stringing cheaply and with low silver consumption. Why pay a premium to get it from gtat? And especially now they can get cheap equipment 2nd hand from bankruptcies and just add this stuff themselves. A good example is HSOL who now recently dramatically reduced silver usage. There are also other wire mesh solutions out there (like the copper mesh gtat is suggesting to use.)   Small modules is not exactly less BoS as they claim in the PR media video.. it is in fact the opposite - you have more inverters more wiring etc. You want as big modules as possible to reduce this. Now this is all hype. THE SDR 1000 and SDR 600 polysilicon reactors of GTAT is however not hype - they are quite good. Hyperion is also good in its segment and could possibly even be used for making wafers in the future for solar so that is a good investment they did. 

[kknd1234 90]

David Einhorn's Greenlight Capital disclosed a new "large" position in SunEdison via a letter to investors, Bloomberg reported. Greenlight says its sum-of-the-parts analysis yields a share price around $35 for SunEdison, Bloomberg added. The activist investor also disclosed a "medium-sized" position in Conn's (CONN), Bloomberg noted. Shares of both SunEdison and Conn's spiked higher following the report

 

http://finance.yahoo.com/news/sunedison-rallies-bloomberg-report-greenlight-175851424.html

[Guest JMK]

David Einhorn's Greenlight Capital disclosed a new "large" position in SunEdison via a letter to investors, Bloomberg reported. Greenlight says its sum-of-the-parts analysis yields a share price around $35 for SunEdison, Bloomberg added. The activist investor also disclosed a "medium-sized" position in Conn's (CONN), Bloomberg noted. Shares of both SunEdison and Conn's spiked higher following the report

 

http://finance.yahoo.com/news/sunedison-rallies-bloomberg-report-greenlight-175851424.html

I never followed speculation especially with David who is the same insider type player like Bill Ackman. These guys are from the core of the WS "mafia" i.e. when they disclose anything it is a high time to start moving to another direction unless of course you are a day trader. I can no exclude that SUNE will hit 22-23 but fundamentals (current and projected) do not support even $10 SP. SUNE at 35 makes the same sense  as CSIQ 350.     

[Scsnospam 117]

That is a huge vote of confidence in solar. Hopefully, more hedge funds will step up to the plate as well. Any thoughts on why SUNE over others?

[Scsnospam 117]

Found some info over on ZH. Cannot copy paste, so here's the link to the whole letter - http://www.zerohedge.com/news/2014-04-22/david-einhorn-we-are-witnessing-our-second-tech-bubble-15-years-full-letter

 

He discusses why SUNE - basically valuing the Yieldco at $34, 9x EBITDA, 5% dividend. Does not seem to care about semi wafer and module business.

[Guest spiritcraft]

There is a growing trend of "analysts" formulating price targets based on forward PEs well higher than the 10 range that seems to be the cry of those in the "commodity" camp.  I have officially decided to like this trend.

[kknd1234 90]

BELMONT, Calif. and TORONTO, April 23, 2014 /PRNewswire/ -- SunEdison (SUNE), a leading solar technology manufacturer and provider of solar energy services, announced today that it has closed on financing for two solar power plants to be built in Ontario, Canada.  Deutsche Bank Securities Inc. is providing construction financing. The plants will provide employment for skilled manufacturing and construction workers in Ontario.

http://finance.yahoo.com/news/sunedison-closes-ca-115-million-120000155.html

[uchsteve 115]

• GAAP revenue of $546.5 million and GAAP EPS of ($2.31)
• Non-GAAP revenue of $577.6 million and non-GAAP EPS of ($0.25)
• Solar Energy non-GAAP revenue related to 76 MW of solar energy systems, 74 MW of solar energy systems retained and 463 MW under construction at quarter end
• Solar project pipeline grew to 3.6 GW and backlog was 1.0 GW at end of quarter
• Closed $150 million of a $300 million non-recourse revolving construction facility
• Closed $250 million non-recourse facility for portfolio acquisitions

More interesting is their discussion on strategy of selling assets vs. holding vs. yield co.

 

http://seekingalpha.com/article/2202653-sunedisons-sune-ceo-ahmad-chatila-on-q1-2014-results-earnings-call-transcript?part=single

 

[uchsteve 115]

http://finance.yahoo.com/news/sunedison-announces-proposed-offering-500-111300042.html

 

[uchsteve 115]

$500 million aggregate principal amount. Close on June 10, 2014.Initial purchasers have a 30-day option to purchase an additional $100 million. Interest rate of 0.25% per year, payable semiannually. Mature on Jan. 15, 2020. 

Initial conversion rate = 37.2148 shares of common stock per $1,000 of notes. Equal to an initial conversion price of $26.87 per share. Net proceeds = $487 million or $584.5 million if option exercised.

$400 million of the net proceeds to be contributed to TerraForm Power. Remaining to fund working capital, the cost of convertible note hedge transactions and  other general corporate purposes.

 

http://solarindustrymag.com/e107_plugins/content/content.php?content.14202

[explo 611]

Seems they get around 3 times the amount of convertible debt at 15 times lower interest cost than CN. I don't understand why CN paying 6% for loans and 4% for CBs is considered unfair advantage. What a killer deal this would have been for CSIQ.

[odyd 1,268]

Sounds like loans are being subsidized via preferential treatment.

[Guest BIPV Investor]

Indeed. If manufacturing becomes global, it is unclear what advantage the US listed names will have. Sunpower just raised 400M and the stock ended positive. Lets see any Chinese name do that.

 

For example, Sunpower could do a 18% dilution via a secondary and raise one billion dollars, up a brand-new +1GW fab in Malaysia/Vietnam/Philippines/Mexico/etc. No need to make everything to typical Sunpower quality, thinking more of an entry level module that would be on par with the JKS/TSL. Their costs would be competitive as nearly all steps would be identical to what it would take for a Chinese name to produce modules that avoid tariffs. I guess Chinese still have some cost advantage with having HQ staff in China as it is very expensive to have a HQ in the Bay Area as everyone demands silly things like raises and stock options.

[Guest BIPV Investor]

Sounds like loans are being subsidized via preferential treatment.

 

The "free market" is allowed to give preferential treatment. It is only when governments you don't like do it that is is a problem.

[Guest Xeloris]

I think CN are now in a loosing situation.   Market caps are 1/4th 1/5th that of major US companies, as BIPV mentions a similiar dilution (15-18%) is enough to swallow one of the larger CN Companies. 

 

CN's are being shut out of every market outside of China, which is looking like its getting pretty crowded not only from CN names that being kept alive that should be dead. But now some US names such as SUNE/SPWR have moved in with major pipelines.

[odyd 1,268]

It is only when governments you don't like do it that is is a problem.

You mean like DOE giving half a billion to Solyndra? The existence of double standard is very typical to the US government. This is apolitical forum but think of Middle East for about 10 minutes.

Flextroincs which makes panels for SUNE in Malaysia and Ontario, will not be facing tariffs in China, if they are made on Huantai wafers and transforemd to cells by JA Solar. Good deal for those guys.

[Makan 72]

With such a low interest rate it can be seen investors are very eager to invest in solar. Just not in Chinese one. I guess interest for TSL will be around 4.5% for their CB. The question is really, if this different access to capital turns now for the 3 US companies in a important competitive advantage in the race to become big. Some % difference in project finance makes a huge difference in leveraged IRR for example and therefore selling prices. Did anybody observe how project loans compared between the US and CN lately?

Definately China should get the domestic market running again to provide some home support.

[Pop2mollys 409]

I don't think many own GTAT but figured I post...

"The company has entered into an agreement with Qatar Solar Energy (QSE) to supply its HiCz200 furnaces for QSE's integrated PV manufacturing project in Doha, Qatar. As noted by QSE in a recent press release, QSE has opened a 300MW integrated facility and plans for the project to reach 2.5GW."

Looks like besides their sapphire business their solar business will be heating up in 2015/2016. furnaces for 300MW and if capacity is expanded to 2.5 GW that will be huge amount of furnaces at around 45-50% margins on equipment.

On top of that it broke out of inverse head and shoulders today while market down pretty big.

http://finance.yahoo.com/news/gt-advanced-technologies-announces-pv-130000201.html

[Paybak66 41]

Yup...nice to see this PR from them.

Green on a red day is nice also!

So, has GTAT still not been confirmed as the provider of saphire for the new iphone yet?

What are the chances that they dont get that from AAPL?

[Pop2mollys 409]

Yup...nice to see this PR from them.

Green on a red day is nice also!

So, has GTAT still not been confirmed as the provider of saphire for the new iphone yet?

What are the chances that they dont get that from AAPL?

GTAT is the only company right now in the world with the capabilities to provide just not the quantity but price point for Apple. Apple is in a monster agreement with GTAT, they chose GTAT by fronting them 1/2 billion to get sapphire plant up and running.