In the current credit environment, there are several fairly big companies that could get in enough trouble that it would wipe out the common shareholders. The ones in the financial industry like Countrywide (CFC) and E*Trade (ETFC) are obvious. But there are others outside finance that have huge debt loads which can no longer be fre-inanced to buy them time, especially if the core businesses are not doing well.
Charter Communications (CHTR) Charter now has over $19 billion in debt and a market cap of only $486 million. It stock has recently fallen from $4.93 to $1.20. In the last quarter, Charter had $105 million in operatng income on $1.525 billion in revenue. Interest expense was $452 million. Charter is up against increasing competition from satellite TV and telecom companies. It does not have the capital it needs to upgrade its infrasturcture to stay in the competitive game.
Journal Register (JRC) The newspaper chain had operating income of $22 million last quarter on revenue of $121 million. Interest expense was almost $10 million. Long-term debt is over $700 million, and revenue at JRC and most newspaper companies is dropping at about 7% year-over-previous year. Its stock has fallen from over $8 to about $2 over the last year.
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