Why Shares of SunEdison Inc. Dropped Today
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of SunEdison dropped as much as 11.1% today after the solar project builder announced it was dropping a project.
So what: SunEdison said it is abandoning a 20 MW project it won in February in India because the job is no longer financially viable. Rules about local manufacturing of panels have resulted in rising prices, and those higher costs make the project unprofitable. The move will cost the company a $333,000 bidding deposit.
Now what: A 30 MW project that SunEdison won will be built, but it appears that costs for 375 MW worth of projects won at auction in February could be under scrutiny. I'd expect to see slightly higher prices for panels this year as the industry recovers, but India's prices will be exaggerated because of local sourcing rules. This is a negative for SunEdison today, but only incrementally, and I'd view the industry-wide sell-off as a buying opportunity.
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The article Why Shares of SunEdison Inc. Dropped Today originally appeared on Fool.com.Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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