More Bail-Outs Ahead?
I was surprised at some of the names on this list, well known and large companies. However, that doesnâ€™t mean anything anymore as we all now know. Though the stock market has been slowly coming back they say, these guys are apparently hurting, and may soon be facing bankruptcy according to this article. Iâ€™m sure they donâ€™t think the economy is getting better. I sure hope there wonâ€™t be more bail-outs, or it could never end?
I would suppose anybody that works for, or owns stock in these corporations would be worried by this financial news from Yahoo. Â
Ten Big Companies That Are Veering Toward Bankruptcy
From The Business Insider (http://www.businessinsider.com/), Sept. 18, 2009:
Despite a few green shoots in the economy and a rocketing stock market, many large companies are still struggling to avoid bankruptcy.
A new report by Audit Integrity (http://www.reuters.com/article/pressRelease/idUS114031+16-Sep-2009+BW20090916) identifies some high-profile names "that have the highest probability of declaring bankruptcy among publicly traded firms."
Which companies appear the worst off? We took the list and removed any company with a market cap under $3 billion. We then ranked the remaining names by a simple measure of the market's perceived bankruptcy risk - Market Cap (MC) divided by Enterprise Value (EV). The less MC vs. EV, the less residual shareholders' value (above what debt holders can claim) the market is pricing-in for the company. Thus a lower MC/EV means the market thinks the company is more likely to go bankrupt.
Check out the names on this list if interested.
To read more click on blue link~
Most of this is Greek to me on what they base this on, but it is interesting. Glad I donâ€™t own stock in themâ€¦ donâ€™t know about my 401K plan though, eek!