Vivint Solar Inc (VSLR) Heats Up with New Financing

Vivint Solar Inc (VSLR) is edging higher after securing new financing for its residential solar projects

Mar 22, 2016 at 1:58 PM
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Vivint Solar Inc (NYSE:VSLR) is up 2.1% at $3.43 today, on news that it has secured $200 million in financing for its residential solar power projects. The stock hit a record low of $3.29 on Friday, still reeling after ending its merger agreement with Sunedison Inc (NYSE:SUNE).

Technically speaking, VSLR has been on a downtrend since last July. And the shares' last attempt at a serious rally came up short when they ran into resistance at their descending 40-day moving average. In fact, since last summer's high of $16.00, the stock has given up 79% of its value.

160322VSLR

Underperforming the S&P 500 Index (SPX) by 65.5 percentage points over the last three months, VSLR also has a 14-day Relative Strength Index (RSI) of 30 -- right on the edge of "oversold" territory.

Unsurprisingly, traders have been wary of VSLR for some time. In the option pits, speculators are still heavily targeting puts over calls. The equity's Schaeffer's put/call open interest ratio (SOIR) of 4.86, for example, shows puts outnumbering calls nearly 5-to-1 among options expiring in the next three months. This ratio also outranks 93% of the past year's readings.

There are some signs bears are beginning to back off, however. Short interest on VSLR fell by more than 10% during the most recent reporting period. But these pessimistic bets still account for over 26% of the security's total available float. And at VSLR's typical daily volume, it would take almost two weeks to buy back all the shorted shares.

Analysts may not have given up all hope in VSLR, either. While several cut their price targets on the stock last week, the average 12-month price target of $7.10 is more than twice Vivint Solar Inc's (NYSE:VSLR) current value.

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