4 Companies That Are Bleeding Cash
KiOR
Clean energy is another area that investors need to watch out for potential bankruptcies. Several publicly-traded and private solar firms have gone belly up recently, led by the high-profile blow-up of government-backed Solyndra.
One clean energy stock that short sellers are ogling is KiOR (KIOR), which aims to convert biomass into fuel oil. To make that happen, KiOR is pouring huge sums of money into its facilities to generate meaningful production.
The company's technology is said to be very promising, which is why shares rose from their mid-teens IPO last summer to above $20 by late September. Shares are now below $10 and could be headed even lower as investors start to realize that more money will be needed to see this company through to eventual profitability. KiOR's first plant will likely come on line this summer, and a second plant is expected to be running by the end of 2013. Meanwhile, cash flies out the door. KioR likely lost around $50 million in 2011, and analysts think losses could reach $100 million in 2012 and 2013, thanks to heavy spending on new plants. The company currently has $150 million in cash and the well could run dry by the end of this year unless KiOr can raise a lot more money. It needs upwards of $100 million more just to get its two plants going and reach profitability, and that assumes no glitches. KiOR's survival will hinge on oil prices. Its technology is uncompetitive when oil trades below $76 a barrel. So the company needs to see the current lofty prices for oil (which was recently just above $100 a barrel) to stay in place for the company to attract fresh investors. If KiOR waits too long, and oil prices pull back, it may find it impossible to raise cash. These companies aren't in deep distress now, but their balance sheets are weakening and more troubling times may lie right around the corner. To see these stocks in action, check out the Cash Burners portfolio on Stockpickr.Follow Stockpickr on Twitter and become a fan on Facebook.
Select the service that is right for you!
COMPARE ALL SERVICESAction Alerts PLUS
TRY IT FREEJim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
Product Features:
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Dividend Stock Advisor
TRY IT FREENew! $49.95/yr
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
Product Features:
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Stocks Under $10
TRY IT FREEDavid Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.
Product Features:
- Model portfolio
- Stocks trading below $10
- Intraday trade alerts
- Weekly roundups
Real Money
TRY IT FREE24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
Product Features:
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
Real Money Pro
TRY IT FREEAll of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
Product Features:
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Options Profits
TRY IT FREEOur options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
Product Features:
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV
