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Weight Watchers International, Inc. Message Board

  • ryan18290 ryan18290 Feb 14, 2012 6:54 PM Flag

    Debt to skyrocket

    Just to make a note, I am short WTW, but longs I would be very very worried about this. WTW just announced a $720M buyback of shares at $73+ per share (which is dumb, first you buy low sell high), but even there share buybacks are horrible and do nothing for a stock price. Better off to just completely pay off debt then sky the divvy...okay enough of that rant. But WTW now has $215M in cash on the books according to the release. That means WTW has to add $505M in debt to do this share buy back. Therefore WTW is going to go from 85% debt to equity to 128% debt to equity. This is how you put companies bankrupt. If I were long, I would get the f out here. Horrible management by this company.

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WTW
5.90-0.25(-4.07%)Sep 1 4:01 PMEDT