über Kreditwürdigkeit.
By Lisa Sanders,
CBS.MarketWatch.com
Last Update: 11:43 AM ET Jun 23, 2000
NewsWatch
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NEW YORK (CBS.MW) -- Shares of Amazon
slumped more than 21 percent Friday after Lehman
Brothers characterized the e-tailer’s credit quality as
deteriorating and advised investors to avoid the
company’s convertible securities.
Shares of Amazon lost 8 15/16 to
33 1/16 in recent trading, on the
heels of a drop of nearly 9 percent
Thursday.
“Amazon has one of the
best-established brands in the B2C space,” Lehman
noted in a morning note.
“However, from a bond perspective, we find the
credit weak and deteriorating. Our negative thesis
stems from Amazon’s massive negative operating
cash flow, poor working capital management and
increasing debt.”
Amazon (AMZN: news, msgs) has a 4.75 percent
convertible maturing in 2009 and a euro-dominated
convertible at 6.75 percent maturing in 2010.
Given the Seattle-based company’s financial
situation, Lehman said that an investment in the
Amazon debt is more risky than potentially rewarding
and recommended avoiding the securities.
Amazon could not immediately be reached for
comment. Calls to rating agencies Fitch IBCA,
Moody’s Investors Service, and Standard & Poor’s
were not immediately returned.