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Nashville's Gaylord Entertainment, which still plans on building a subsidized project in Chula Vista, on April 15 called off a $252.5 million deal to buy a resort in San Antonio. The problem was financing. After the economy slumped, Gaylord sought to bring in another partner to provide capital, but it didn't work out. When the deal was scrubbed, Gaylord stock shot up over $30, even though the company has to pay a $12 million cancellation fee. The stock was down $1.38 or 4.52 percent today (Tuesday April 22) to $29.15. Over the last 52 weeks, the stock has been as high as $59.89. It has taken a steady beating. Standard & Poor's expects Gaylord to earn 30 cents a share this year. Last year it earned 29 cents, excluding a $2.20 gain from sale of an asset. S&P says it has seen "softer attendance" in this year's economic downturn. Also, Gaylord "has taken on more financial risk through higher debt levels." Already, a bit more than half the company's capitalization is debt. S&P gives the company a C quality rating. Morningstar gives it an F for profitability and a D for financial position. The company told me today that it expected the on-again, off-again Chula Vista Bayfront project would be complete in 2013 at the earliest. Subsidies are expected to make up $300 million of the $900 million project.
Nashville's Gaylord Entertainment, which still plans on building a subsidized project in Chula Vista, on April 15 called off a $252.5 million deal to buy a resort in San Antonio. The problem was financing. After the economy slumped, Gaylord sought to bring in another partner to provide capital, but it didn't work out. When the deal was scrubbed, Gaylord stock shot up over $30, even though the company has to pay a $12 million cancellation fee. The stock was down $1.38 or 4.52 percent today (Tuesday April 22) to $29.15. Over the last 52 weeks, the stock has been as high as $59.89. It has taken a steady beating. Standard & Poor's expects Gaylord to earn 30 cents a share this year. Last year it earned 29 cents, excluding a $2.20 gain from sale of an asset. S&P says it has seen "softer attendance" in this year's economic downturn. Also, Gaylord "has taken on more financial risk through higher debt levels." Already, a bit more than half the company's capitalization is debt. S&P gives the company a C quality rating. Morningstar gives it an F for profitability and a D for financial position. The company told me today that it expected the on-again, off-again Chula Vista Bayfront project would be complete in 2013 at the earliest. Subsidies are expected to make up $300 million of the $900 million project.