Borders Group Inc. Shares Under One Buck ($1)

Borders Group, Inc. (NYSE:BGP) shares fell 22% to under a dollar this week and closed Friday at just 86 Cents.  Borders shares lost another penny after-hours to 85 Cents, that makes a 6 month loss of 78%.
Is Borders now just another Penny stock awaiting certain Bankruptcy death or is this a diamond in the rough?  Borders Group needs help ASAP.

Borders Group lost its CEO Ron Marshall this week, Marshall resigned as chief executive, president and director, effective immediately. Marshall was hired to the CEO position only a year ago in a wider management shake-up. Marshall is leaving to assume the post of CEO at another publicly held retailer. Borders has named Michael Edwards, who currently serves as executive vice president and chief merchandising officer, to the position of interim CEO. The company retained Korn/Ferry International to lead the search for a permanent replacement.

Borders (BGP) market cap is now under $52 million, slightly more than the $42 million senior secured term loan Borders is due to repay April 1 to Bill Ackman's Pershing Square Capital Management LP, which also holds more than 30% of its shares. Failure to pay will trigger a default on Borders' $1.13 billion credit agreement.

Earlier this month Borders reported that for the 11 weeks ended Jan. 16, same-store sales at its Borders superstores fell 14.6%. Excluding multimedia, the company said comparable sales fell 10.9%. Total sales for Borders Group fell nearly 14% to $846.8 million.

Fellow Masters, the bad news continues to rain on Borders Group Inc., at this point taking a risk even at 86 cents a share may be a dangerous move.

Disclaimer: No positions in any of the securities mentioned in this publication.