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"Borders is trading at 86 cents a share and has a market cap of 62 million dollars. It has around 700 locations valuing them at less than $100,000 per store" T
by Timothee 16y ago
"Borders is trading at 86 cents a share and has a market cap of 62 million dollars. It has around 700 locations valuing them at less than $100,000 per store"
That's a pretty shocking figure if you ask me. It's hard to believe when you hear about some startups raising a few millions over an idea without any business model... (e.g. come to mind the young though very popular Path and Flipboard: $2.5M for the former, $10M for the latter, and I imagine valued in the same range as Borders for these rounds)
I know that comparing web-startups to a brick-and-mortar business is not as simple as that, but it does put things in perspective.
- lkrubner 16y agoI assume the real estate under the stores is worth more than $100,000 per store, so Borders must have a lot of debt, or the figure is irrationally low. Or possibly, Borders only rents its land, but I find that a little surprising.
- Timothee 16y agoOn Google Finance, some links (that I haven't studied in details) seemed to say that indeed Borders had a lot of debt. "As Borders Group Inc. asks publishers for leniency on paying bills, the bookstore chain has been in discussions with restructuring advisers about ways to rework its debt-heavy balance sheet" http://blogs.wsj.com/bankruptcy/2011/01/07/the-daily-docket-borders-talks-with-restructuring-pros/ http://blogs.wsj.com/bankruptcy/2011/01/07/the-daily-docket-...
- b_emery 16y agoOur local Borders was in a leased building (it's closed now). I'd be surprised if they owned any of the stores.
- Umalu 16y agoBorders leases all its stores. It has about $1.3 billion in liabilities ($350 million in debt, $620 million in payables and another $350 million in other long-term liabilities). In the most recent quarter for which it reported results, it lost $74 million. Ouch.