RadioShack Corporation (NYSE:RSH) will seek new financing by the end of the current year, according to reports emerging this afternoon from Bloomberg.The ailing electronics retailer has had a rough time so far in 2013, though investors have backed the firm in the hopes it can reinvent itself. The market appears disappointed in the news that RadioShack will seek additional financing at time of writing.
According to the report, RadioShack Corporation (NYSE:RSH) will seek to take on debt before the year is out. Moody's Corporation (NYSE:MCO) rates the firm's debt at Caa1 right now, with the most recent change in ratings coming back in March. The firm's debt was downgraded three times in 2012. The ratings agency has maintained a negative outlook on the firm's debt.
RadioShack Corporation (NYSE:RSH) shares were falling on today's market in the wake of the refinancing news. The firm has seen its stock rise by more than 50 percent so far in 2013. Investors appeared to have been positive in regards to the company's chances to turn itself around, though that appears to have changed now.
Business at RadioShack Corporation (NYSE:RSH) has been declining for years, but the real drop has come since 2010. Stock fell steadily in value through the end of 2012, but optimism arrived in January 2013 and has added 59 percent to the stock price so far this year.
Trading of RadioShack Corporation (NYSE:RSH) stock in the wake of the financing revelation was unpredictable and inexplicable. The company's chart looks completely wild and some have been suggesting that there are liquidity problems on the market for the shares.
The pricing problems are likely to be resolved by the market in the coming hours, but trading in the company appears to be very unusual. The firm has not yet released a statement about the rumored debt financing. When it does, the problems with the company's shares may become more clear.