What happened to General Growth Properties Inc (NYSE:GGP)?
Trailing-12-month earnings per share in 2009: $0.02
Most recent TTM earnings per share: ($0.52)
Debt-to-cash ratio in 2009: declared bankruptcy in 2009
Most recent debt-to-cash ratio: 25.6
Total return from start of crash to today: (60%)
On July 10, 2009, Dan Amos of the Strategic Short Report said:
In a scenario of paying off staggering debt loads under stress, the claims of common shareholders are either diluted or wiped out completely. This is the scenario facing General Growth Properties Inc (NYSE:GGP), and shareholders will be lucky to recover anything. You can find shades of the General Growth saga throughout the REIT space. … While there are certainly opportunities to be had in this market, as I see it, REITs aren’t one of them.
General Growth Properties Inc (NYSE:GGP) had already gained 268% by this point after initiating bankruptcy proceedings.
Mall operator General Growth Properties Inc (NYSE:GGP) foundered in the financial crisis as strapped American consumers stayed home, but it’s begun to find its way again after exiting bankruptcy. Despite the earnings loss reported, General Growth’s EBITDA, mall portfolio net operating income, funds from operations, and adjusted net income all displayed positive momentum in its most recent quarter. Consumers are back, and malls are looking crowded again. General Growth’s pared down billions in debt and has refinanced billions more at more favorable interest rates, and its projections for 2013 also offer hope for slow but steady growth.
What happened to Ford Motor Company (NYSE:F)?
Trailing-12-month earnings per share in 2009: ($6.50)
Most recent TTM earnings per share: $1.42
Debt-to-cash ratio in 2009: 70.0
Most recent debt-to-cash ratio: 4.6
Total return from start of crash to today: 60%
On Aug. 10, 2009, investment research executive Martin Weiss told Bloomberg Businessweek:
Anyone recommending Ford Motor Company (NYSE:F) today is probably basing it on the shaky premise that (1) the recent pick-up in auto demand is sustainable, (2) the U.S. auto industry somehow has restored — or will restore — its competitive power, (3) Ford Motor Company (NYSE:F) shares still provide good value despite their sharp rally — from $1.26 per share last November to $8.44 last week. … [T]he auto industry recovery is driven more by unsustainable government bailouts than lasting growth in demand, and Ford Motor Company (NYSE:F) will have long-term difficulty competing.
Ford Motor Company (NYSE:F) had risen 344% from the Dow’s low point by the time this warning was published.
Ford Motor Company (NYSE:F)’s done a great job paring down its massive debt load since the end of the crash. In the past four years, long-term debt has fallen by nearly 30%. It’s also done a great job at changing its image from outmoded American clunker to stylish but affordable innovator. Analysts like the one I quoted saw a forest of sickly automakers but didn’t think to take a much closer look at the individual trees. Ford’s sales declined in 2009, as did everyone else’s — but from then on, Ford’s increased its sales numbers by nearly 40%. That’s no small feat in a world still struggling mightily to recover from financial catastrophe.
The article 4 Treasures From the Great “Dash for Trash” Rebound of 2009 originally appeared on Fool.com and is written by Alex Planes.
Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter, @TMFBiggles, for more insight into markets, history, and technology.The Motley Fool recommends American Express and Ford and owns shares of Ford.
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