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SunEdison, Inc. (NYSE:SUNE) Claims Its Renewable Energy Firm Is At Substantial Risk Of Bankruptcy- Ambarella (NASDAQ:AMBA)

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The public listed unit of SunEdison, Inc. (NYSE:SUNE) [Detail Analytic Report], TerraForm Global reported that global renewable energy firm is at substantial risk of bankruptcy, according to Reuters. Shares of firm plunged over 5.28% in early session on Wednesday.

TerraForm Global, citing SunEdison’s liquidity issues, disclosed that it would join its parent in delaying its annual report for the year completed on December 31. A bankruptcy would rank among the largest involving a non-financial firm in the previous ten years, according to bankruptcydata.com. SunEdison didn’t respond for immediate comment.

TerraForm Global, one of two yieldcos of SunEdison reported in a regulatory filing that it would join its parent and TerraForm Power in delaying its annual report for the year completed on December 31. However, the firm revealed that it didn’t rely substantially on SunEdison for funding or liquidity and that it would have sufficient liquidity to support its operations even if its parent sought bankruptcy protection. Annual report of TerraForm Global was due by March 30.

TerraForm Global announced that its parent may not transfer to it some solar energy projects in India, for which TerraForm Global has paid $231 million, and also may not complete other deals. TerraForm Global proclaimed that if SunEdison doesn’t perform under these contracts, it could have a material adverse effect on TerraForm Global. Brian Wuebbels, CEO of TerraForm Global, is also CFO of SunEdison.

Morgan Stanley upped its rating on Ambarella, Inc. (NASDAQ:AMBA) [Detail Analytic Report] stock from equal weight to overweight while keep its price target of $55 on the stock. Shares of Ambarella climbed 9.31% to close at $44.50 in last trading session on Tuesday. Morgan Stanley stated in an analyst note that they have consistently believed that the firm has maintained leadership in video processing for high-end cameras, but have remained on the sidelines until now as they thought that the multiple had climbed too high given customer concentration.

Shares of Ambarella has plummeted 65% from its highs previous summer because of declining sales from wearable cameras, especially from major customer GoPro (NASDAQ:GPRO), and lower sales from the Chinese surveillance industry. Analyst at Morgan Stanley stated that recent channel checks in China are more optimistic and the firm’s revenue can grow significantly without GoPro. Other core growth segments such as drones, autos, consumer surveillance cameras, and wearables should continue to drive strong growth, according to analysts. Chips for automotive driver assistance are also anticipated to add strategic value to the firm even though the segment will not add substantial revenues in the short term, analysts added.

This week on Wall Street, AMBA was definitely stealing the show from rest of titans as stock mean recommendation from pool of analysts was 2.1, comparatively equal to last week’s mean recommendation. On a scale of 1-5 (Strong Buy- Sell) stock mean target was for 57.55 while the highest it touched was 86.00. For current month, out of the pool analysts, 8 recommended for a “Hold” , 22 gave recommendation for “Buy” , 1 analysts gave underperform ratings and 16 gave preference to Strong Buy.

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