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Economy

Corporate Bankruptcies Likey To Take Sharp Jump (CHTR)(MNI)(JRC)(LVLT)

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By Douglas A. McIntyre Published
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It should come as no surprise that companies which has taken on too much debt over the last three years will start to fail and have to file for Chapter 11. Some of the signs that this process is about to accelerate are starting to show up.

"High-yield debt sales have sputtered so far in 2008 and are off to their weakest start in 17 years thanks to an anemic U.S. economy, a worldwide credit crunch and a pronounced absence of investor appetite for risky assets," according to Reuters.

While there is no saying which companies might face severe problems certainly several firms with widely traded stocks are at risk. This would include newspaper companies McClatchy (MNI) and Journal Register (JRC) which have high debt and rapidly falling revenue. Cable company Charter (CHTR) is saddled with $19 billion in long-term debt. Level 3 (LVLT) has a shaky balance sheet and extremely modest cash flow. Shares sold short in the firm are higher than those of any other stock listed on Nasdaq.

Douglas A.McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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