UBS analyst Julien Dumoulin-Smith attempted to answer more investor questions on beaten down SunEdison (NYSE: SUNE). Dumoulin-Smith said while liquidity is not the same question today as it was in the initial August slide in shares,
other issues raised in the 10Q merit greater attention from investors.

The analyst said an underlying question is the cost for the company to borrow. They see three key angles pointing higher:

1) the latest disclosure of a 9.25% second-lien term loan of $169 Mn from GS for a tenor of just 1-year issued on August 11th (SUNE was at ~$14/sh), with a 5.3% origination cost. We note the limited liquidity raised for such a short period is unusual given mgmt's large cash balance.

2) Converts are now trading at significant discounts to par, suggesting refinancing cash interest risk is real albeit maturities are relatively long-dated; and

3) We see the latest proposed TERP Warehouse for Invenergy as more onerous given the substantial equity infusion
required, suggesting future structures for SUNE could necessitate infusions, as the latest requires $388 of $688 Mn injected from TERP with no corresponding distributions.

On what could help the shares, Dumoulin-Smith said renegotiation and restructuring.

Must notably, the analyst sees an renegotiation of the Vivint terms as a possible approach, following other deals which have been scuttled recently. A shift in the the exchange ratio and shift in the mix (cash, stock, convert proportions) could be considered. "Presumably a greater cash component could compensate for an overall reduction in total consideration," the analyst gives as a example. That said, management remains certain there are no 'outs' in deal terms. Also, with the debt now now trading 30-40c, they see an opportunity to lock in equity value via exchange. Dumoulin-Smith said as credit quality deteriorates, counterparty willingness to transact is potentially impeded. They see a reason for both equity and credit holders to entertain such a transaction. "We suspect the delayed issuance of a proxy could be indicative of any changes," the analyst said.

The firm maintained a Neutral rating price target of $6, saying they remain on the sidelines as as investors continue to digest 3Q updates. They see the the litany of datapoints arising out of the 3Q update as continuing to weigh on shares.

For an analyst ratings summary and ratings history on SunEdison click here. For more ratings news on SunEdison click here.

Shares of SunEdison closed at $4.54 yesterday.