Following the plunge in Thomas Cook yesterday, it looked like these penny stocks would be worth snapping up. People always go on vacation and Thomas Cook is a big brand name with over 170 years of goodwill.
Further analysis reveals it is being run like Greece. Or a debt loving real estate fund. I mean who actually walks into a shop (1300 to choose from) and then gets someone to surf the web on their behalf to buy a holiday? Most of us are lazy but surely not that lazy. Well they employ 30,000 people so there must be a demand. Further analysis shows they operate holidays (all those lovely fixed costs) and airplanes so it looks like a case of over development.
The debts though are staggering. Nearly 1 billion GBP. And they wanted a bail out of GBP 100 million. LTV = 1 billion / 100 million.
Would be cheaper to beef up the website and employ a call centre with Skype.
USA criticises something it wish it had (bloomberg)
eBay, Amazon etc take on Thomas Cook (bloomberg)
EU officials to increase their vacations to boost the flagging leisure industry.