Kmart Stock Flags on Warning2 Jan, 2002 By: Hive News
Kmart stocks dropped 17 percent Wednesday after an analyst at Prudential Securities downgraded the chain store's stock rating to "sell" based on disappointing holiday sales and earnings.
Prudential's report termed Kmart's financial position "precarious," although the chain spokesman Jack Ferry said "Kmart has sufficient funds and available lines of credit to continue to carry out our strategies. Kmart is implementing a major corporate revitalization strategy that includes massive cultural and operational changes" that are already showing results, he told Associated Press.
"We don't believe a Chapter 11 filing is imminent,'' Prudential's Wayne Hood wrote in Wednesday's note. "But we wouldn't rule it out if the first half of 2002 is disappointing."