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Some San Diegans are still hoping that Nashville-based Gaylord Entertainment will build a $1 billion hotel and convention center on the Chula Vista bayfront, with more than $300 million of government subsidy, or corporate welfare. The facility would concentrate on business meetings. However, that business is crumbling in the current economic environment, notes analyst Mark Basham of Standard & Poor's. Gaylord stock has plunged over the last 52 weeks from a high of $59.89 to $20.26 this morning (July 8). It's down more than 5 percent already today. Gaylord opened its new facility near Washington D.C. in March. In February, the company raised the estimated cost by $50 million to $80 million. Originally, it was to cost $870 million. Gaylord took on more debt than expected for the project. Already, debt tops equity on the balance sheet. What's hurting the stock is "the company's reliance on the business group travel market," which always gets cut back when the economy softens or goes into a recession. S&P gives Gaylord a quality ranking of C, its second worst of 8 categories. Morningstar, a stock rating firm, gives Gaylord a grade of F for profitability and C for financial position.
Some San Diegans are still hoping that Nashville-based Gaylord Entertainment will build a $1 billion hotel and convention center on the Chula Vista bayfront, with more than $300 million of government subsidy, or corporate welfare. The facility would concentrate on business meetings. However, that business is crumbling in the current economic environment, notes analyst Mark Basham of Standard & Poor's. Gaylord stock has plunged over the last 52 weeks from a high of $59.89 to $20.26 this morning (July 8). It's down more than 5 percent already today. Gaylord opened its new facility near Washington D.C. in March. In February, the company raised the estimated cost by $50 million to $80 million. Originally, it was to cost $870 million. Gaylord took on more debt than expected for the project. Already, debt tops equity on the balance sheet. What's hurting the stock is "the company's reliance on the business group travel market," which always gets cut back when the economy softens or goes into a recession. S&P gives Gaylord a quality ranking of C, its second worst of 8 categories. Morningstar, a stock rating firm, gives Gaylord a grade of F for profitability and C for financial position.