Large US Companies That May Disappear In 2008

[REWahoo]

I thought this was an interesting article on several US companies the author says come January of next year won't exist as we know them today:

Motorola (MOT)
Sears Holdings (SHLD)
Citigroup (C)
Ford (F)
Yahoo! (YHOO)
AMD (AMD)
Sprint (S)
Quest (Q)

"Some may not even make it halfway through the year. Not all will go out of business. Some may simply be auctioned off in pieces. Others may be bought. These companies will not exist in their current forms as they are known to their shareholders and consumers now.

When a company ceases to exist as an independent entity, it is not necessarily bad for shareholders. Some may be worth more in parts. Often a bust-up or merger is what brings owners the most money."

24/7 Wall St.: The Large US Companies That May Disappear In 2008


Anyone buying these companies on the bet they will be sold off at a fat profit?

 

[JPatrick]

I thought this was an interesting article on several US companies the author says come January of next year won't exist as we know them today:

Motorola (MOT)
Sears Holdings (SHLD)
Citigroup (C)
Ford (F)
Yahoo! (YHOO)
AMD (AMD)
Sprint (S)
Quest (Q)

I think many, if not all, will look different, but I'd bet most will not disappear.
A smaller company that I think will actually go away is Circuit City.
Of course, if the economy has another big leg down, that list could grow.

 

[FinanceDude]

I thought this was an interesting article on several US companies the author says come January of next year won't exist as we know them today:

Motorola (MOT)
Sears Holdings (SHLD)
Citigroup (C)
Ford (F)
Yahoo! (YHOO)
AMD (AMD)
Sprint (S)
Quest (Q)

"Some may not even make it halfway through the year. Not all will go out of business. Some may simply be auctioned off in pieces. Others may be bought. These companies will not exist in their current forms as they are known to their shareholders and consumers now.

When a company ceases to exist as an independent entity, it is not necessarily bad for shareholders. Some may be worth more in parts. Often a bust-up or merger is what brings owners the most money."

24/7 Wall St.: The Large US Companies That May Disappear In 2008


Anyone buying these companies on the bet they will be sold off at a fat profit?

The only one I have been buying in small amounts is Citi. I wouldn't touch an American car maker with a 10 foot pole. I don't need to get whacked on the stock, they already whacked me on their BONDS........

 

[Nords]

This article reads like it was written by an intern at the Bill Gross "Dow 5000" School of [-]Financial Pornography[/-] "Journalism"...

Hmmm... here he is:

Douglas A. McIntyre is the former Editor-in-Chief of Financial World Magazine. He has also been president of Switchboard.com, which was at the time the 10th most visited website in the world, according to MediaMetrix. He has also been chief executive of both On2 Technologies, Inc. and FutureSource LLC.
Doug's articles exhibit a rare combination that makes them an ideal fit for Seeking Alpha: he knows technology cold, has a sharp understanding of what's priced-in to stocks, and writes extremely well (as you'd expect).

Now I'd like to see his brokerage portfolio and his Schedules D.

 

[steve88]

yahoo? dont think so

 

[FinanceDude]

Now I'd like to see his brokerage portfolio and his Schedules D.

He probably has $20million in zero coupon bonds like Suze Orman.

That cracks me up, putting yourself out there as a "financial guru" when you have NO money at risk.

Oh well, maybe Peter Lynch has $200 million in zero coupons.........if I found that out to be true, then I WOULD be intrigued.........

 

[Gworker]

I read an article on Sears that said they would have to sell part of their business this year to survive. I think it was in Fast Money magazine.

 

[Nords]

Oh well, maybe Peter Lynch has $200 million in zero coupons.........if I found that out to be true, then I WOULD be intrigued.........

In one of his books, describing Oct 1987, he mentions that he was glad his daughters' college funds were in EE bonds. Back in the days before 529s, those were the best deal in town.

 

[Texas Proud]

OK.... my prediction is that more than half of these will still be here at the end of the year....

The main question is what is meant by "current form"... but I still say more than half will be on the ticker tape...

 

[haha]

He probably has $20million in zero coupon bonds like Suze Orman.

That cracks me up, putting yourself out there as a "financial guru" when you have NO money at risk.

Do you somehow know that he has nothing at risk? Or are you just poking fun at him for some defect that you are imagining?

And regarding Suze Orman- a portfolio of 100% treasury zeros would have shown a very attractive return.

Not only that, she does disclose her investment position to clients and non-clients.

Ha

 

[terminator]

He's not saying they will disappear as in go bankrupt, mostly he sees them as companies that would be better off split up, taken private or merged. Given that his list makes sense. The only two that are truly losing money on an ongoing basis are AMD and F -- and AMD has plenty of cash on hand to survive a while and F, well, it sure has a lot of experience at re-arranging the deck chairs . . .

 

[al_bundy]

the author of the article needs to read up the history of some of these companies

Motorola always has a hot product and then a slow couple of years. Before the Razor there was the StarTac until Nokia had them for lunch. and i forgot what they were into before cell phones other than the stupid robot dog from 2000.

Sears is toast this year or in the next few years

AMD, see Motorola. they have been almost out of business so many times it's like a tradition. they also hit a high of $42 in 2000 and then traded down to $7 until they came out with the Athlon and then the Athlon64. ATI was a bad choice, they need to merge with Nvidia. and from what i remember Nvidia was a joke 10 years ago, so you never know what is going to happen

Ford, see Motorola and AMD

Yahoo, OK growth rate but Wall Street hates them because Google was the darling this Internet cycle. Too bad it's ending and in a few years we'll see the next big thing on the internet. For all the hype Google is #1 in search and way behind everyone else in every other category.

Sprint, in 1984 they had the first fiber LD network. Now they are a cell phone company. In 20 years they will be into something else. They got past the LD implosion of 7 years ago and i bet they will get past Nextel

Citi, see AMD above. they almost go out of business every 10 years almost on schedule. don't understand the surprise this time

circuit city, toast. management doesn't understand the simple concept that people don't want to wait in line 30 minutes to pay for something

now Ambac and MBIA, everyone is watching to see what happens to them

 

[clifp]

I pretty much agree with Mr Bundy (wow agree with a shoe salesman for stock advice scary thought) and his assement of these companies.

Pretty much all of them of have been on the this will disappear/go broke/get bought list for a decade.

By all rights Ambac and MBIA should disappear, I suspect that having them disappear would be to expensive for a variety of big money folks (banks, pension and mutual funds) so they will muddle thru with their faux AAA credit rating, before being mergered/bought in a year or two.

 

[Arc]

This is like the business version of the Ghoul Pool. Pick 10 companies that you think will die at the beginning of year and see who did the best at end of year. Interesting.

 

[Marquette]

I predict they all merge. CitiFordMotMicroSprintHoo! will gladly file your house and car in a consolidated loan. The car will have integrated cell phones in the gull-wing doors. The heads-up display will be powered by an ATI graphics card. Of course, you would have picked this car based on extensive research on this company's website. You'll get a discount on cell and local phone service if you agree to bundle it and charge it on your credit card.

It's a fantastically sensational piece all around.

On the other hand, if the dollar weakens, we look like a good investment to foreign capital. Maybe TATA will come in and buy out Ford. We'll finally be able to buy something smaller than a Mini...

 

[Ed_The_Gypsy]

I predict they all merge. CitiFordMotMicroSprintHoo! will gladly file your house and car in a consolidated loan. The car will have integrated cell phones in the gull-wing doors. The heads-up display will be powered by an ATI graphics card. Of course, you would have picked this car based on extensive research on this company's website. You'll get a discount on cell and local phone service if you agree to bundle it and charge it on your credit card.

I like it! Great concept. The venture capitalists will be calling you Monday morning.

 

[danm]

There goes a very smart man. 30 year Treasury zeros, turned over and re-invested every year since 1982 returned 4.7 times what the S&P returned over the same time period. Risky, and the return can be fantastic in a period of declining interest rates.

Some think that the bottom in rates hasn't been hit yet. Recent history seems to support that theory.

Do you somehow know that he has nothing at risk? Or are you just poking fun at him for some defect that you are imagining?

And regarding Suze Orman- a portfolio of 100% treasury zeros would have shown a very attractive return.

Not only that, she does disclose her investment position to clients and non-clients.

Ha

 

[cute fuzzy bunny]

Oh well, maybe Peter Lynch has $200 million in zero coupons.........if I found that out to be true, then I WOULD be intrigued.........

That'd be interesting. Back in 98 or 99 he was quoted in Fortune "Bonds are for wimps"

 

[Texas Proud]

There goes a very smart man. 30 year Treasury zeros, turned over and re-invested every year since 1982 returned 4.7 times what the S&P returned over the same time period. Risky, and the return can be fantastic in a period of declining interest rates.

Some think that the bottom in rates hasn't been hit yet. Recent history seems to support that theory.

Why go back to when the interest rates were some of the highest in history?? Most people were not around to invest any kind of big $$s back then.. heck, my dad looked like a great investor when he got some 5 year CDs at 17%.... so yes, I am sure that if you bought zeros then it was 'great'...

What about if you invested 15 years ago... or 10 even Not as good I bet.... but then again.. I will not spend the time looking it up...

 

[cute fuzzy bunny]

Ah, the ways of the data miner are many...

The real return of long term treasuries is around 2%ish. Equities is around 6%.

Sure, the 30 year treasuries paid a handsome interest rate for a time, if you were lucky enough to buy them at their peak.

Also, i'm pretty sure we wont have a lot of decline in the rates from here.

 

[al_bundy]

add Restoration Hardware to the list, Sears wants to buy them out and kill a nice company

 

[cute fuzzy bunny]

I used to like shopping there, and even bought some stuff once in a while.

Then their prices shot through the roof. Goofy.

 

[FinanceDude]

That'd be interesting. Back in 98 or 99 he was quoted in Fortune "Bonds are for wimps"

He's still one of my heroes...........

Nick Murray, an industry guy for FAs, calls fixed income portfolios "cancer" that eats away portfolios........

 

[cute fuzzy bunny]

Thats why I keep my bonds separate from my equities. Should any contagion start, it'll be limited in its ability to spread.

Now, if a bucket eating cancer becomes evident, I'm in big trouble

 

[StJohnsWood]

One thing to consider about Sears is the own alot of real estate much like McDonalds. Its almost like their business is real estate and not retail.

I could see Ford in a world of hurt. I have never looked to buy a Ford ever. I still see them as the 1970's junk they made. If it wasn't for their truck business they would have been gone years ago.