Watch out for companies with Debts: KMX, MGM, MMM & VTR
With the current interest rates, companies which are not making profits and have higher debt exposure would run more risks. Thus, I have set up a screener in the S&P500 to identify some companies with such risks.
I have set up a screener using the following:
S&P500
High Debt/Equity (more than 0.5)
High Long-term Debt/Equity (more than 0.5)
Operating margin (negative) - that is running at operational losses.
From the above screener, there were a total of 4 companies namely Carmax Inc, MGM Resorts International, 3M Co and Ventas Inc. These companies are losing money (making losses) and have significant debts on hand. If these are sustained, the companies would be at risk.
This is just an initial screening and more needs to be done to qualify their fundamentals before we make the decision to buy, sell, hold or avoid.
Revenue, profit, good free cash flow, net debts and retained earnings will be the data that I screen first before I deep dive into other quantitative and qualitative aspects.
Let us take time to review our portfolio. It could be necessary to remove some non-performing and weak fundamental holdings. As always, let us research before investing.
@TigerStars
$MGM Resorts International(MGM)$
$3M(MMM)$
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
During the last meltdown KMX cratered to $6.52 and interest rates range was 4.86-5.38%. So, if we even come close to where the US was 15 years ago what might happen?
MGM should buy 'penn' and fire Penn entertainment's useless management. Instant appreciation of 50% on purchased asset to realize its book value, for MGM !
Market is down except for this- MGM needs to bleed for what they did like DISH