Another disconnect at RadioShack
Wall Street continues to tune out RadioShack. Shares are off 10% to 93 cents in mid-day trading Friday, pushing RadioShack below $1 for the first time ever.
Hurt by plummeting sales, widening losses, disinterested shoppers, liquidity woes and a turnaround plan that's failed to jolt the struggling specialty electronics retailer's prospects, RadioShack's now sinking on renewed bankruptcy rumors.
RadioShack, which operates 4,250 U.S. stores, says its latest quarterly performance was challenged by soft consumer interest in mobile phones, discount pricing and competitors. Sales dropped 13% over the year-ago quarter, while losses increased to $81 million from $10.3 million. Last month, the company said its lenders rejected its plan to close up to 1,100 under-performing stores.
With shares trading below $1, RadioShack now faces the prospect of being delisted by the New York Stock Exchange. Or worse. Earlier this month, Scott Tilghman, a stock analyst at B.Riley whose had a sell rating on RadioShack, set a price target of $0.
'We view recovering for the company as unlikely,' Tilghman said.
Investors, both long and short-term, have suffered a major disconnect. Shares are down nearly 80% from RadioShack's $4.36, 52-week high. And investors who tucked away RadioShack stock certificates at 1980′s $102.25 peak? You're down 99%.
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