Bankruptcy Watch: 14 Risky Restaurant Stocks

McCormick & Schmick's Seafood Restaurants (MSSR)

Altman Z-Score, Trailing 12 Months: 1.68

Altman Z-Score, Last Fiscal Year: 1.81

McCormick & Schmick's Seafood Restaurants (MSSR)

McCormick & Schmick's remained in the danger zone with a Z-Score of 1.68, decreasing from a score of 1.81 in the last fiscal year.

Clearly management knows there's a problem. McCormick & Schmick's officially put itself up for sale in early May following a rejected takeover bid in April.

McCormick & Schmick's said it was considering a sale as one option for maximizing shareholder value.

In April, Landry's Restaurants founder and CEO Tilman J. Fertitta offered to acquire McCormick & Schmick's for $137.2 million, but the seafood restaurant chain rejected the unsolicited bid, saying it undervalued the company.

At the time, Fertitta said he would pay $9.25 per share for each McCormick & Schmick's share he did not already own, a 30% premium to the target's closing price of $7.12 the day before the offer was made. Fertitta's offer was made through a unit of Landry's, which has been acquiring novelty restaurant brands such as the Bubba Gump Shrimp and Oceanaire seafood restaurants and Claim Jumper steakhouses. Landry's traded publicly until 2010 when Fertitta took it private for $1.4 billion. Fertitta already owns a 10.1% stake in McCormick & Schmick's, making him the seafood chain's third-largest shareholder.

>> Consumer Stock Takeovers: Deals and Targets

On June 1 Landry's extended its $137.2 million offer until July 29.

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