Sunedison Inc (NYSE: SUNE)
Sunedison has had a rough time in the market over the past year or so, hasn’t it? While the average investor has jumped on the bandwagon and doomed SUNE to the depths of the abyss, I have maintained a relatively bullish opinion on the stock. Thankfully, I’m not alone. In fact, in my opinion, one of the most impressive writers in the financial sector, Biotech Research Group (go ahead and click the link, it will open in a new tab and you can always come back!), has a very bullish opinion in the stock as well, along with millions of others. So, how were analysts and short sellers able to drive SUNE down so far? Will it ever pop back up? What can we expect to see from the stock moving forward? Well, I will do my best to answer all of this below.
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How Were Analysts And Short Sellers Able To Drive SUNE Down So Far
When analysts and short sellers get hold of even the strongest stocks in the market, they have an uncanny ability to drive the stock downward in a big way. You see, they pound messages into the minds of investors with repetitive posts on message boards and other websites, letting you know everything there is to know about the company – or at least, that’s how they make you feel. They take an overwhelmingly complex topic like accounting for a multi-billion dollar company, and scrunch all of the information into a few sentences, pointing out what they believe are the most important parts of the books. While I take issue with this, it’s the repetitive nature of these posts that has driven fear in the hearts of SUNE investors and caused the value of the stock to fall so very dramatically.
But Wait… Were You Lied To?
The truth is that analysts and writers (including myself) only have access to very small amounts of data when it comes to what we write. When it comes to SUNE, and most other stocks for that matter, we have access to earnings reports that are months old, technical charts, comments made by executives and other data along those lines. So, do we really have a clear picture of a company’s accounting? Probably not! With that in mind, all of the negative hoopla that you’ve seen about Sunedison’s accounting has been nothing more than speculation. The truth is, the company’s accounting, when looking from a different view, looks spot on. They’ve got assets to back up their debts, they’ve got the ability to raise funds for operational cash, they’ve got everything a company needs to stay afloat. Well, with the exception of investor support, and I believe that will change relatively soon!
Will SUNE Bounce Back?
In my opinion, the answer is YES! In fact, I believe that the stock is working to bounce back as we speak. Here’s the bottom line… If analysts were right about SUNE, if there was any validity to the bearish views of investors, if there was a sliver of truth in the message board comments stating that SUNE was doomed, chances are that Sunedison would be very close to hanging the out of business sign in the windows, if they hadn’t already! The truth is, that things aren’t anywhere near as grim for the company as the media portrays. In fact, if you look at the available data, you’ll likely see that things are going very well. As mentioned above, assets far outweigh debt. On top of that, in recent weeks, Sunedison has proven its ability to handle problems quickly. Just take a look at the Vivint Solar lawsuit. Not to mention, SUNE has tons of power purchase agreements that will drive revenue for not only years, but decades to come. All in all, the company looks great, and I believe investors will pick up on that soon enough!
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What Do You Think?
Where do you think SUNE is headed and why? Let us know your opinion in the comments below!
[Image Courtesy of Wikipedia]