back to article Moody's eyes up Sony's debt: Hmm... junk? Bam! Shares drop 11%

Sony shares plunged 11 per cent in Tokyo overnight while ratings agency Moody's has placed the Japanese firm's debt on review for a downgrade that could take it to junk status. Sony said yesterday it was cutting its full-year profit forecast by 40 per cent after another disappointing quarter in tellies and game consoles. The …

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Shame

They have been searching for a reason to exist for years. They are now like a shit copy of Samsung.

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Anonymous Coward

Re: Shame

Even with the claimed most powerful console in the PS4, they have still managed a completely shit launch line up compared to the Xbox One...

If Microsoft could only manage to make the Xbox One as powerful, Sony would be soon heading down Nintendos path of doom...

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Re: Shame

Is no one buying Sony products?

Reason, products are not cutting edge and no longer have that quality kudos any more, not for a long time.

Over priced average products.

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Re: Shame

I have a different list for not buying Sonny products.

It starts with root kitting my PC and continues from there.

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Re: Shame

That bloody entertainment division may drown them. Small monetary gains, huge loss of respect.

Nice boat anchor you have there, hanging off your neck. Quite entertaining one.

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Anonymous Coward

Re: Shame

Joking right? I would rate the ps4 launch titles as 10x better. even they multiplatform titles are 1080p 60fps on ps4, 720 on Xbone

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Re: Shame

There's been talk of Sony dumping the movie/entertainment side for quite a while. Pity they always say that isn't on the table every quarter. They really need to split it off as a separate company at least and let the two companies sink or swim on their own. Heck, being more able to focus clearly on producing their own products they could both do better.

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Re: Shame

It starts with root kitting my PC and continues from there.

Another member of the club, I see.

I wish that those arrogant executives would commit seppuku in atonement for all that they have done.

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MJI
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Re: Shame

Launch lineup

Well since the game I am most after is a PS4 exclusive I don't think so.

Then of course Naughty Dog

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yeah, it started going downhill after the rootkit

they do have some good products. but the company never really changed their tone after using Neil Diamond as a pusher for kernel skulduggery, and they continue to march at the head of the parade of lockdown for technology. so trust among the True Believers is pretty... nil.

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MJI
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Re: Shame

Dump film music, keep games, take TV HiFi Camera ect up market again and drop the cheap crap.

I have a lot of decent Sony stuff, none of it was cheap.

One of the worst LCD TVs I have seen - cheap Sony, best, expensive Sony, you would not think they were same manufacturer.

My 1982 portable video recorder still works!

Yes I am old enough to remember they were premium and worth the premium, they still have the odd product like this, but they have to stop competing against the Koreans and start competing on quality rather than price again.

They need to remember why people bought Trinitron TVs, and it was NOT the price

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Anonymous Coward

Re: Shame

There are fewer PS4 launch titles and they are far worse than the Xbox One's. For instance Forza 5 (1080p 60fps) pisses all over the pathetic DriveClub.....

The PS4 can't manage to run all it's games in 1080p either - BF4 is upscaled on the PS4 - and looks better on the Xbox One - The PS4 has to scale in software - whereas the Xbox One has a hardware scaler.....

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Anonymous Coward

Weren't Mooys the one who rated junk bond AAA? Halfwits.

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Happy

Bad Customer

After the PC rootkits, DRM,and thier support of RIAA, I have stopped knowingly watching any of their movies. If I really want to watch it I wait for it to show up on HBO or Showtime. I may be a bad customer for them. I don't need Sony, Sony needs me!

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I would say that the problem...

Is not Sonys - they have been around for many a year - and will continue to do so for a fair few more I would suggest. However, half the problem for these corporations is that that industry "experts", analysts and investors are still listening to the fuckwits at Moodys rather than doing their own analysis.

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all the bond rating companies are whores

all we're arguing about now is the price.

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Moody's

Moody's, Fitch, etc., all rated Fannie Mae, Freddie Mac, Leman Brothers as AAA just as everything crashed in '08, why do people even listen to them when they failed their biggest test and have demonstrated their total incompetence.

Moody's = junk.

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Anonymous Coward

Re: Moody's = crony capitalism

With just a little bit of research, you can see why the system is broken and why we all have to suffer for the benefit of a few: crony capitalism

A quick search finds that Sony, at

http://www.sony.net/SonyInfo/IR/info/faq/dividend.html

has ALREADY announced their 2013 corporate dividend, ¥12.50 to be started on December 2, 2013. For those who don't understand the conversion, that's $0.126 / €0.0938 per share based upon exchange rate conversion as of today, 3 November 2013.

Now that not may sound like much but, according to

http://www.sony.net/SonyInfo/IR/stock/information.html#module0

Sony has 1,011,950,206 common stock shares in circulation - that's over 1 billion, folks.

So 1,011,950,206 x ¥12.50 = ¥12649377575...or $128,133,889.54.

So Sony has no problem handing out $128.123 million dollars to its shareholders even as they declare a losing year. Sony is willing to pay out these dividends rather than withholding shareholder benefits to help pay down their long term debt, a long term debt that they have serviced so poorly that they have an almost-junk bond, Baa3, rating.

Lesson: It is far more important to placate Wall Street than to have sound long-term corporate financial policy. It is far more important to spoon feed shareholders the crap that they want to hear - that they are important and that capitalism works for their sole interests - than to tell them the truth, that shareholders are supposed to share in the risks of capitalism as granted them in their stock purchase. Let the customers suffer the greatest burden (by having inflated prices, quality of goods or service cutbacks, anything necessary to increase profit margin) in order to make up for the fact that monies are being drained away to pay shareholders an unearned bonuses, as their 'personally owned corporation' isn't performing and is not earning enough to service all its past obligations.

Part of this systemic bias is due to who owns a large majority of Sony shares: as per Sony.net, the largest holders are the Japanese themselves, both individuals and institutional. Therefore, Sony is appeasing the government banking system by paying a dividend it really cannot afford, in order to assure its stockholders that their investment has (undeserved) returns and, thereby, guaranteeing continued faith in the markets (and, by connection via definition, itself as well).

So while the peasants eat bread and water, the aristocracy plays their old game: keep shuffling money between themselves and toast the good times.

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Anonymous Coward

Re: Moody's = crony capitalism

You extrapolated that conclusion from... a single dividend payment? If only you had a clue. Take your whining to zerohedge you dimwitted lefty.

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Anonymous Coward

Re: Moody's = crony capitalism

Did your self-righteous moronic reply also take into account further research into Sony's past financials??

No, it did not, did it?

You spewed garbage out of your pie hole without seeking additional information to confirm your suspicions. Sony has been paying dividends every year, on average $0.10/share, per historical financials.

So, in your arrogance, you think Moody's gave a Baa3 rating just because of this single year?? Because that is what you believe, saying that my opinion must also be based upon this single year's performance.

If you had bothered to inform yourself before saying worthless opinions, you would have found all this out prior to posting. But you didn't, so you didn't.

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why do we still trust these f***wits?

Didn't Sony grease them enough this time?

Moody's themselves admitted their ratings are merely suggestions that must not be taken too seriously: after the subprime fiasco by confessing that "the bar moves so quickly, it is impossible to predict". Wonder where is that Kolchinsky guy now? Sleeping with the fishes?

It's sad, after all they have done, we still haven't managed to get rid of these ignorant, overpaid pompous gits and worse allow them to offer opinions on how to manage our monies.

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