All Posts Tagged With: "poor decision"
Businesses that might find themselves going out of business
Jennifer McClelland | RSS | Fri, Nov 13 2009 | 4 Comments
The Business Insider had an article from September 18th that said what companies, using a Market Cap to Enterprise Value ratio, might be going bankrupt in the future. A lower MC/EV score means that is a company that is far more likely to go bankrupt.
I found some of the companies on the list to be a bit surprising.
Here is the list from the Business Insider:
The number one company that is likely to go bankrupt with a EV/MC ratio of 32% is Hertz. The company had to take out a huge amount of debt to fund its fleet in May. In June, the rating of the company was dropped by Moody’s.
Number two on the list is Textron. The company sells business jets, which is not the business to be in right now. The company had to write off $2.3 billion and cancel a new jet design. The MC/EV ratio is 39%.
Number three is Sprint/Nextel. I am not that surprised to see Sprint make the list, but I really have high hopes for the company because I suppose I have a lot of loyalty toward the company. In reality, Sprint’s poor decision to buy Nextel and the fact that it is hemorrhaging customers (well, hopefully this will slow down due to the new phone offerings and actual great deals on service) has led to the company having a MC/EV ratio of 41%.
Number four, and perhaps the most surprising to me on the list, is Macy’s. The original article asks if anyone shops at department stores anymore and I can honestly say, from what I’ve seen…yes they do and they do in en masse. Same store sales fell all year (but, really, what retailer has done that well this year?). The company has $2.4 billion worth of debt set to mature over the next five years. The MC to EV ratio is 47% for Macy’s.
Fifth is Mylan. Mylan bough Merck’s generic sales an business department in 2007 and overpaid for it. Because of the bad deal it got, it is facing $5 billion in long term debt. Mc/EV ratio for the company is 51%.
If you would like to read the rest of the list, please visit the source.
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Tags: sprint nextel, business department, value ratio
What companies could we see go bankrupt in the future?
Jennifer McClelland | RSS | Tue, Sep 22 2009 | 0 Comments
The Business Insider had an article from September 18th that said what companies, using a Market Cap to Enterprise Value ratio, might be going bankrupt in the future. A lower MC/EV score means that is a company that is far more likely to go bankrupt.
I found some of the companies on the list to be a bit surprising.
Here is the list from the Business Insider:
The number one company that is likely to go bankrupt with a EV/MC ratio of 32% is Hertz. The company had to take out a huge amount of debt to fund its fleet in May. In June, the rating of the company was dropped by Moody’s.
Number two on the list is Textron. The company sells business jets, which is not the business to be in right now. The company had to write off $2.3 billion and cancel a new jet design. The MC/EV ratio is 39%.
Number three is Sprint/Nextel. I am not that surprised to see Sprint make the list, but I really have high hopes for the company because I suppose I have a lot of loyalty toward the company. In reality, Sprint’s poor decision to buy Nextel and the fact that it is hemorrhaging customers (well, hopefully this will slow down due to the new phone offerings and actual great deals on service) has led to the company having a MC/EV ratio of 41%.
Number four, and perhaps the most surprising to me on the list, is Macy’s. The original article asks if anyone shops at department stores anymore and I can honestly say, from what I’ve seen…yes they do and they do in en masse. Same store sales fell all year (but, really, what retailer has done that well this year?). The company has $2.4 billion worth of debt set to mature over the next five years. The MC to EV ratio is 47% for Macy’s.
Fifth is Mylan. Mylan bough Merck’s generic sales an business department in 2007 and overpaid for it. Because of the bad deal it got, it is facing $5 billion in long term debt. Mc/EV ratio for the company is 51%.
If you would like to read the rest of the list, please visit the source.
Related posts:Businesses that might find themselves going out of business
Tags: poor decision, business jets, enterprise value
Sponsors stand behind Phelps after marijuana incident.
Jennifer McClelland | RSS | Mon, Feb 02 2009 | 0 CommentsA picture of Olympic champion Michael Phelps that shows him smoking marijuana has been going around the internet for a couple of days now. The picture has made people ask what will happen to all the sponsors as well as awards Phelps has.
Usually when an athlete is connected to a drug or other questionable activity, they are dropped from any sponsorship and quickly fade into obscurity. However, several of his sponsors have accepted the apology he gave shortly after the picture was published.
This isn’t the first time Phelps made a poor decision. In 2004, after the Athens Olympics he was arrested for drunk driving and issued an apology then too. It seems as though that incident was all but forgotten.
So, the Olympic golden boy needs to stay on the straight and narrow if he wants to keep his chances of going to the next Olympics and keeping the sponsorships that will get him there.
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Tags: poor decision, couple of days, smoking marijuana
Has the government overcompensated for the economic downturn?
Jennifer McClelland | RSS | Sun, Dec 14 2008 | 0 CommentsThis year we’ve seen the government try to make up for policies and practices used by greedy lenders and firms that have made poor decisions by throwing money at it, passing bits and pieces of legislation, and even giving a “stimulus” to U.S. tax payers…
But has the government overcompensated for the lax regulation of the past? Just as when you run off the road and attempt to right yourself, maybe instead of helping right the economy, it has started a crash…flipping several times along the way.
I believe that throwing money at the situation won’t make it go away, and giving firms like the Big 3 and already corrupt financial institution billions of dollars with out real consequence just sets us up for a bigger problem down the road.
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Tags: billions, economy, institution
HSBC is feeling the sting of the American mortgage crisis also.
Jennifer McClelland | RSS | Mon, Aug 04 2008 | 0 CommentsEuropean bank HSBC reported a 29% drop in first half profits. In the same half in 2007, HSBC posted a $10.9 billion profit, while in the same half this year they posted a $7.7 billion profit.
HSBC holds Household International Inc. partially responsible for the decline. In 2003, HSBC purchased the Illinois based lender. This was a pretty poor decision because it made the bank the largest U.S. sub prime mortgage lender.
I do not feel bad for any bank that makes these mistakes. They became greedy and purchased other banks participating in sub prime lending. Shame on them.
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Tags: U.S., sub prime lending, stake
