The debt you are concerned about cares what % rate? The bonds you want to float would carry what junk bond % rate? I assume you want to pay off the debt and float junk bonds,no? I personally think the co. is doing fine paying down the debt,selling off some under performing stores, adding sav-a-lot stores,updating some stores and continuing the dividend.Thanks
I'm not sure they could float a bunch of debt but yea that is what I'd like to see them do even if interest expense increases by quite a bit. They are just coming too close to the covenant level for my comfort and I'd like to hear management say they are easily meeting the covenants rather than cutting CapEx and SG&A in order to avoid violations.
It isn't like they are a bank and have to worry about a run but I wonder if vendors and employees are worried about them being around in a year or two. The bond prices indicate no worries so I think I'm likely overstating the risk but I know how easy it is to pump up short and medium term profitability while killing the business in the long term.