TomTom shares hit an all-time low last week at just under €11 after an analyst raised concerns that the company may need refinancing before the end of 2009 as consumer spending has slowed across the board. The analyst, from JP Morgan, said:
“We are concerned that high gearing and exposure to weak consumer spending may result in a need for refinancing before the end of 2009.”
TomTom’s shares, which were initially €17.50 in May 2005, have dropped by 25% since last Thursday, when the company held an analyst day, and over 80% since October 29 last year, when shares hit a record high of €66.70. The fall has been attributed to TomTom’s debt since purchasing Teleatlas earlier in the year, however, competitors Garmin have also seen a significant drop in share prices, and the Sat Nav market as a whole has seen a decline after such a high paced beginning.
Fri, Oct 10, 2008
Financial News