Energy Conversion Devices, Inc. (NASDAQ: ENER) is one of the first formal deaths in the solar sector, although Evergreen Solar was the first of the long-time solar players. Shares are now barely $0.22 per share and the old buyout rumors never turned out to be anything more than high hopes. The company’s own description in its press release calls itself “a leading global provider of lightweight, flexible solar products and systems for the building-integrated and commercial rooftop markets.” Leading? Where? Leading the path to zero maybe. Energy Conversion said in mid-December that it had elected to defer an interest payment to noteholders and noted, “We are continuing to pursue a repositioning of our solar business for future success.” Sorry, that is the beginning of the end even if this was well over a $50.00 stock during the solar bubble from 2007 to 2008.
FriendFinder Networks, Inc. (NASDAQ: FFN) is a company which should have never been allowed to come public and its underwriters may actually share some liability in a recent class action lawsuit filed. After pricing at $10.00, the stock now sits under $1.00 and appears to be the worst of all IPOs in 2011 barring any of the Chinese pump and dump accounting fraud outfits. Apparently porn mixed with social networking is not as good of a combination as the company hoped and it raised far less in the IPO than when it first filed to come public.
Nortel Networks Corp. (NRTLQ) is still around as far as a Pink Sheet stock. The company has dwindled down to nothing other than some patent sales out of bankruptcy and the homepage is effectively a moniker for its “Business & Financial Restructuring” site. While its latest balance sheet still listed $1 billion in cash, the total “NNI” liabilities “subject to compromise” were more than $5.5 billion. Would someone finally put the remaining OTC shares out of their misery in 2012? This is a zombie stock if there ever was one.
Pinnacle Airlines Corp. (NASDAQ: PNCL) may be the next airline implosion after AMR. There is a chance it will hang on, but at $0.85 it has a 52-week range of $0.80 to $8.68 and a mere $16 million market cap. The only thing that has kept Pinnacle relevant as a stock is that it once had a decent roster of institutional investors. Shares have been cut in half in just the last few weeks of the year and this worry about the stock disappearing may be more share price driven than anything. The balance sheet still looks manageable as of September 30, 2011 but additional layoffs are speculated on top of recent worker furloughs. A brokerage research note from Maxim even recently said it has a high probability of bankruptcy when it started it with a SELL rating.
Reddy Ice Holdings, Inc. (RDDY) has just recently lost its NYSE listing under the ticker “FRZ” on the next to last trading day of 2011 as it moved to the OTCQB. The NYSE had this as a delisting candidate for some time and it has finally come to pass. S&P even downgraded the rating from B- to CCC+ in November and left a Negative outlook on the company after a prior similar move from Moody’s. At $0.24, its 52-week range is $0.15 to $3.81 and the market cap is down to $5.6 million. Shareholders may have to hope for that buyout that seems to have been lost in the shuffle.
YRC Worldwide Inc. (NASDAQ: YRCWD) is a crying shame of a trucking outfit for investors. The company’s $65 million market capitalization is very misleading when you consider almost $3 billion in debt for its entire enterprise value. Frankly, we cannot figure any reason this common equity exists at all other than that the company just wants to avoid a total wipe-out for common holders at all costs. For all practical purposes this has been a total wipe-out. A stock at $9.,73 does not sound like it is on death’s door to most new investors but the adjusted 52-week trading range is $9.00 to $1,584.00. Reverse stock splits are often doomed to head lower and headed lower it has: it has had two reverse splits in the last fifteen months at 1:25 in October 2010 and 1:44 in December 2011. YRC is effectively a zombie stock.
Again, some of these stocks may survive the year 2012 and maybe one or two can engineer some incredible turnarounds.
JON C. OGG