BBC NEWS Americas Africa Europe Middle East South Asia Asia Pacific Arabic Spanish Russian Chinese Welsh
BBCi CATEGORIES   TV   RADIO   COMMUNICATE   WHERE I LIVE   INDEX    SEARCH 

BBC NEWS
 You are in: Business
Front Page 
World 
UK 
UK Politics 
Business 
Market Data 
Economy 
Companies 
E-Commerce 
Your Money 
Business Basics 
Sci/Tech 
Health 
Education 
Entertainment 
Talking Point 
In Depth 
AudioVideo 


Commonwealth Games 2002

BBC Sport

BBC Weather

SERVICES 
Thursday, 17 January, 2002, 07:44 GMT
Silence cuts third off Kmart's value
New York Kmart store
Kmart is falling behind its competitors
Shares in bankruptcy threatened Kmart fell to their lowest level since the mid-1960s as the credit rating agency ditched the US retail giant from the leading Standard & Poor's index of America's 500 biggest shares.

Investors were spooked by an eerie silence following a meeting of the company's directors and by yet another debt downgrade by S&P.

The share price fell almost 50% to $1.60, having traded as low as $1.27 during the day.

"The stock is trading on pure emotion," said Ladenburg, Thalmann & Co retail analyst, Eric Beder.

"They've needed to say something for weeks. If Kmart is not going to declare Chapter 11 [bankruptcy], they need to come out and forcefully say that."

Early this year, Prudential Securities advised its clients to sell the stock. "Sell" ratings are much rarer in the US than in the UK.

Kmart is seen as falling behind its competitors such as the Walmart and Target chains, with outdated stores and poor support and logistics systems leading to weaker customer service.


Terror's impact

Signs of a slowdown

Rate cuts

Analysis

Key players

FULL SPECIAL REPORT
See also:

13 Jan 02 | Business
Kmart shares plunge
02 Jan 02 | Business
Kmart slumps on bankruptcy talk
02 Jan 02 | Business
US economy turning up?
13 Dec 01 | Business
US retail sales plunge
13 Dec 01 | Business
US corporate woes continue
12 Dec 01 | Business
US trade deficit shrinks
12 Dec 01 | Business
False starts for US economy optimism
12 Dec 01 | Business
US interest rates cut again
23 Aug 01 | Business
US retail results poor
Internet links:


The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.


E-mail this story to a friend

Links to more Business stories