Analyst foresees liquidation for Furniture Brands
Jay McIntosh -- Furniture Today, August 8, 2013
ST. LOUIS — Furniture Brands International's stock was downgraded Tuesday by the securities firm Stifel Nicolaus, with analyst John Baugh saying he believed "some form of liquidation or bankruptcy filing is imminent, and we believe that the value on the equity is $0."
The manufacturer and retailer's stock has tumbled more than 40% this week, closing Wednesday at $1.20, after a disappointing earnings report issued Tuesday morning.
Furniture Brands reported a 4% sales decline in the second quarter and a $40.8 million net loss, largely because of the writedown in value of certain assets, including computer software it had decided not to fully implement.
In the earnings report, FBI Chairman and CEO Ralph Scozzafava said the company will work to further cut costs, pursue asset sales and work with its lenders to try to modify its credit facilities.
Baugh said in his research note that Furniture Brands' annual revenue has declined for the past eight years.