I didn't read every thread today, so forgive me if this article is being discussed in another one.
http://www.usatoday.com/money/companies/ma...-pensions_N.htm
http://www.usatoday.com/money/companies/ma...-pensions_N.htm
As pensions dried up, four firms paid top execs $49.5M
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Dog Wonder
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If we are fair with management, will they be fair with us?
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5 Deathbed Stocks?
By Rich Duprey
November 20, 2009 | Comments (0)
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LCC
US Airways Group
Rate LCC CAPS Rating 1/5 Stars . $3.10 $-0.02 (-0.64%)
More about LCC
Taking Fido on Your Trip? There's a Drug for That.
Las Vegas: Dead or Alive?
BROWSE ALL LCC ARTICLES
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David Gardner called it. He’s up 1,334%! See what David’s recommending that you buy NEXT.
•Click Here Now
We've all heard of the "death rattle," the last gasp from a lost soul's lungs. Sometimes, we seem to hear it from the companies in which we invest. Revenues dry up. Margins contract. Profits evaporate. All these signs suggest that their condition is worsening -- a financial death rattle, if you will.
Stocks in sick bay
Don't assume that all such companies are goners. Some will barely cling to life, while others will make a full recovery. Here, though, we’re seeking companies that have all but given up the ghost.
For help, we'll turn to the clever coroners at our 140,000-strong Motley Fool CAPS community, where members give the thumbs-up or thumbs-down to some 5,300 stocks. We've unearthed a handful of stocks that look like they might be headed six feet under based on their one-star ratings, but we'll head over to CAPS to measure the opinions there.
Then we'll palpate the stocks' pulses with some quick tests for liquidity -- who knows, maybe we'll still find some signs of life! The current ratio and quick ratio (also called the "acid test" ratio) give us an idea of a company's ability to pay its bills, and the Altman Z-Score suggests companies in danger of bankruptcy. Companies scoring 3.00 and above are considered safe, between 2.70 and 2.99 are "yellow flags," between 1.80 and 2.70 have a good chance of going bankrupt within two years, and those with scores below 1.80 mean the cryptkeeper is waiting.
Here’s today's list. The question is: With our primary screen being those stocks that CAPS investors have given one-star status to ... are these companies only mostly dead, or have they already given up the ghost?
Stock
CAPS Rating
Current Ratio
Acid-Test Ratio
Altman Z-Score
Recent Price
Affiliated Computer Services (NYSE: ACS)
*
1.7
1.5
2.64
$55.09
Isle of Capri Casinos (Nasdaq: ISLE)
*
1.1
0.8
0.93
$8.30
Nanometrics (Nasdaq: NANO)
*
3.1
1.6
1.57
$11.20
Pulte Homes (NYSE: PHM)
*
3.0
0.6
1.25
$9.82
US Airways (NYSE: LCC)
*
0.8
0.6
0.78
$3.12
Sources: Motley Fool CAPS; Capital IQ, a division of Standard & Poor's.
We obviously don't know whether these companies are headed six feet under, so don't short them based on their appearance here. Moreover, some companies -- like software makers and financials -- don’t neatly fit into the Altman Z-Score scale. Let's use the CAPS community as our guide to determine whether these stocks are destined to seriously underperform the market.
Whistling past the graveyard
Nanometrics might not be ready to sing "swing low, sweet chariot" just yet, but it's going to have to do more than post a single quarter of growing sales to impress the investors on CAPS, who are nearly evenly divided over its prospects. And when one looks solely at the All-Star members rating it (75% think it will underperform the market), there's a decided bearish position.
Nanometrics' stock soared in recent weeks as after it posted a third-quarter profit and confounded analyst expectations. The supplier of advanced process control metrology systems said sales surged 12% and expenses plunged from the previous period as it received multisystem orders from customers. As it exciting as the jump might have been, even management says not to expect a repeat in the near future.
Top-rated CAPS All-Star UltraLong thought Nanometrics' performance was good, but also noted management's caveats on future growth:
Underperform recommendation from what I would refer to as a rampant overvaluation at these levels. Nanometrics has never shown any real consistency in turning a profit and they even STATED in their quarterly report that their revenue growth would begin slowing. If you didn't notice, 15% revenue growth isn't exactly blowing the door off the barn. Despite a relatively low 19M in debt, thats quite a hefty load for a company like this and could pose a credit risk going forward. Although like Vanamonde said, this could have long-term potential, this is a venemous snake waiting to suck your money in the short-term.
Nanometrics competes against the likes of KLA-Tencor (Nasdaq: KLAC) and Rudolph Technologies (Nasdaq: RTEC), both of which were also able to handily beat analyst forecasts as the semiconductor industry rolled higher. Nanometrics will need to perform at this level consistently if it wants to warrant investor confidence.
Rattling the cage
Are these companies doomed to drag their investors into an underworld of underperformance? Or will they be resurrected to stalk the markets once again? It pays to start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page. Sign up today, absolutely free, and let us know whether you think the Grim Reaper's at the door.
Like this article? Get our best articles delivered direct to your inbox at no cost. Sign up for Foolwatch Weekly by entering your email below.
Try any of our Foolish newsletter services today, free for 30 days.
Fool contributor Rich Duprey does not have a financial interest in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool's disclosure policy remains vibrant and full of life.
Read/Post Comments (0) | Recommend This Article (0)
By Rich Duprey
November 20, 2009 | Comments (0)
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0 Email
Share
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LCC
US Airways Group
Rate LCC CAPS Rating 1/5 Stars . $3.10 $-0.02 (-0.64%)
More about LCC
Taking Fido on Your Trip? There's a Drug for That.
Las Vegas: Dead or Alive?
BROWSE ALL LCC ARTICLES
Disney Buys Marvel!
David Gardner called it. He’s up 1,334%! See what David’s recommending that you buy NEXT.
•Click Here Now
We've all heard of the "death rattle," the last gasp from a lost soul's lungs. Sometimes, we seem to hear it from the companies in which we invest. Revenues dry up. Margins contract. Profits evaporate. All these signs suggest that their condition is worsening -- a financial death rattle, if you will.
Stocks in sick bay
Don't assume that all such companies are goners. Some will barely cling to life, while others will make a full recovery. Here, though, we’re seeking companies that have all but given up the ghost.
For help, we'll turn to the clever coroners at our 140,000-strong Motley Fool CAPS community, where members give the thumbs-up or thumbs-down to some 5,300 stocks. We've unearthed a handful of stocks that look like they might be headed six feet under based on their one-star ratings, but we'll head over to CAPS to measure the opinions there.
Then we'll palpate the stocks' pulses with some quick tests for liquidity -- who knows, maybe we'll still find some signs of life! The current ratio and quick ratio (also called the "acid test" ratio) give us an idea of a company's ability to pay its bills, and the Altman Z-Score suggests companies in danger of bankruptcy. Companies scoring 3.00 and above are considered safe, between 2.70 and 2.99 are "yellow flags," between 1.80 and 2.70 have a good chance of going bankrupt within two years, and those with scores below 1.80 mean the cryptkeeper is waiting.
Here’s today's list. The question is: With our primary screen being those stocks that CAPS investors have given one-star status to ... are these companies only mostly dead, or have they already given up the ghost?
Stock
CAPS Rating
Current Ratio
Acid-Test Ratio
Altman Z-Score
Recent Price
Affiliated Computer Services (NYSE: ACS)
*
1.7
1.5
2.64
$55.09
Isle of Capri Casinos (Nasdaq: ISLE)
*
1.1
0.8
0.93
$8.30
Nanometrics (Nasdaq: NANO)
*
3.1
1.6
1.57
$11.20
Pulte Homes (NYSE: PHM)
*
3.0
0.6
1.25
$9.82
US Airways (NYSE: LCC)
*
0.8
0.6
0.78
$3.12
Sources: Motley Fool CAPS; Capital IQ, a division of Standard & Poor's.
We obviously don't know whether these companies are headed six feet under, so don't short them based on their appearance here. Moreover, some companies -- like software makers and financials -- don’t neatly fit into the Altman Z-Score scale. Let's use the CAPS community as our guide to determine whether these stocks are destined to seriously underperform the market.
Whistling past the graveyard
Nanometrics might not be ready to sing "swing low, sweet chariot" just yet, but it's going to have to do more than post a single quarter of growing sales to impress the investors on CAPS, who are nearly evenly divided over its prospects. And when one looks solely at the All-Star members rating it (75% think it will underperform the market), there's a decided bearish position.
Nanometrics' stock soared in recent weeks as after it posted a third-quarter profit and confounded analyst expectations. The supplier of advanced process control metrology systems said sales surged 12% and expenses plunged from the previous period as it received multisystem orders from customers. As it exciting as the jump might have been, even management says not to expect a repeat in the near future.
Top-rated CAPS All-Star UltraLong thought Nanometrics' performance was good, but also noted management's caveats on future growth:
Underperform recommendation from what I would refer to as a rampant overvaluation at these levels. Nanometrics has never shown any real consistency in turning a profit and they even STATED in their quarterly report that their revenue growth would begin slowing. If you didn't notice, 15% revenue growth isn't exactly blowing the door off the barn. Despite a relatively low 19M in debt, thats quite a hefty load for a company like this and could pose a credit risk going forward. Although like Vanamonde said, this could have long-term potential, this is a venemous snake waiting to suck your money in the short-term.
Nanometrics competes against the likes of KLA-Tencor (Nasdaq: KLAC) and Rudolph Technologies (Nasdaq: RTEC), both of which were also able to handily beat analyst forecasts as the semiconductor industry rolled higher. Nanometrics will need to perform at this level consistently if it wants to warrant investor confidence.
Rattling the cage
Are these companies doomed to drag their investors into an underworld of underperformance? Or will they be resurrected to stalk the markets once again? It pays to start your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page. Sign up today, absolutely free, and let us know whether you think the Grim Reaper's at the door.
Like this article? Get our best articles delivered direct to your inbox at no cost. Sign up for Foolwatch Weekly by entering your email below.
Try any of our Foolish newsletter services today, free for 30 days.
Fool contributor Rich Duprey does not have a financial interest in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool's disclosure policy remains vibrant and full of life.
Read/Post Comments (0) | Recommend This Article (0)
nycbusdriver
Veteran
The obituary on USAir(ways) has been written so many times in the last 15 years someone needs to just make a big rubber stamp of it to save time.
And this "system" sounds like voodoo stuff. Besides, the stock market is 95% emotion, and 5% winners who know it.
Yes... but since it was not your prior mgt.... you are not the ones who had to suffer at the likes of Wolfe..
whom.... took our pay.... took our retirement....took our benefits....
while he sits in his Lovely house in the sprawling country overlooking the mountains...
watching his hired help and ranch hands tend to his mansion and farm... and livestock...
So.... be carful for what you say to your EASt counterparts.... cuz.... it could happen
to you....
and it just might.....
http://web.archive.org/web/20040213004344/...ate+2+27+03.pdf
Bankruptcy court testimony reveals that US Airways gave
$35 Million in pension payments to top 3 former executives...
Stephen Wolf, who ran the airline for seven years and now serves as chairman of the board, received
$15 million.
His protege, Rakesh Gangwal, who resigned
as president and CEO in November 2001, also received $15 million, and Lawrence Nagin, the airline’s
longtime executive vice president and general counsel who retired last March, received $5 million.
US Airways SEC Filing Shows CEO Was Paid $1.45M
Dow Jones Business News Friday March 28, 1:25 am ET
NEW YORK (Dow Jones)--US Airways , which entered bankruptcy in August, brought in new executives
at higher salaries while it was cutting the pay of other employees, according to fi lings the
airline made with the Securities and Exchange Commission, The Washington Post reports in its
Friday edition.
The airline paid chief executive David N. Siegel about $1.45 million in salary and bonuses in his
fi rst year at the airline, almost double the $734,561 in compensation that his predecessor, Rakesh
Gangwal, received in 2001, the Post said.
The carrier also increased Chief Financial Offi cer Neal S. Cohen’s pay and bonus by 69%, according
to the Post.
During bankruptcy reorganization, the Arlington-based carrier secured more than $1.9 billion in pay
and contract concessions from its employees, leaseholders and aircraft suppliers. The airline is also
preparing to receive $ 900 million in federal loan guarantees when it exits from bankruptcy, the
Post reported.
http://web.archive.org/web/20041012074414/...pdate+4+103.pdf
robbedagain
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- Oct 13, 2003
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Ok we had outrages when banks such as citi, aig etc did this to their top level mgmt where is the outrage for this type of stuff? why didnt congress put caps on this too? Ill remember the next time they come for paycuts and Ill tell you take it first before me!
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