Well, that's a tough question to answer. Many big name companies are on that list too, like Exxon. Judging by the dollar amount, 285 million, it's about 40+% of their annual earnings (650 m), or about 60 cents per share. Now, the company does not have to put in the 285 m right away but the labor department would be on their case and push for some kind of improvement (if they are doing their jobs). Also, a company can not use a lot of its stocks to fund its pensions. GM, I remember, reached some kind of settlement with the labor department a couple of years ago about its pension liability (underfunded in the billions) where a small portion of it are funded by GM stocks.
Stock prices are generally weak across the board recently and I don't think this will change much.
If, and when, the company starts paying back this liability. Assume it spreads out the payment over 3 years (just to choose a number), this will cost 20cents a share in terms of earnings.
That's all I know. This industry (electronic commerce) is growing but competitions are coming in too.
-Pei-Hwa |
