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July 25, 2008 9:48:25 PM CDT

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Bear Stearns Posts First Loss

Posted Dec 20, 07 9:19 AM CST in Business 

(Newser) – Analysts expected Bear Stearns to post its first-ever loss today, they just expected it to be smaller. After $1.9 billion in subprime writedowns, the company posted a $6.91 loss per share, dwarfing the $1.82 analysts predicted. Executives gave up their bonuses, as revenue from debt sales and trading were wiped out, Bloomberg reports. “They’ve got a myriad of problems,” one analyst said.

The writedowns eclipsed the company’s $1.2 billion forecast. While many of the firm’s competitors have taken bigger hits, Bear Stearns’ stock has fallen further because of over-reliance on fixed-income. “Their problem is they're not as diversified,” an analyst explained. “They’re kind of a bond shop.” A recession would likely help the company, slowing rivals and increasing the price of bonds.

Source Bloomberg

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This is an undated handout file photo of Bear Stearns Cos. Inc. chief executive James E. "Jimmy" Cayne. (AP Photo/HO/Bear StearnsCos. Inc., file)   (Associated Press)
The logo for Bear Stearns is shown at its corporate headquarters in New York, in this July 18, 2007 file photo. Bear Stearns Cos., the nation's fifth-largest investment bank, on Wednesday, Nov. 28, 2007...   (Associated Press)
The headquarters for securities firm Bear Stearns is shown March 16, 2006 in a New York file photo. Bear Stearns Cos., the fifth-biggest U.S. investment bank, said Thursday, June 14, 2007 fiscal second-quarter...   (Associated Press)
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subprime mortgages  • Bear Stearns  • earnings reports  • writedowns  • quarterly reports


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