[NumStulpata]

Thats gotta hurt hasn't it? [rofl] http://www.nytimes.com/2006/10/26/bu...rtner=homepage

[Michaelnewerb]

Thats gotta hurt hasn't it? [rofl] http://www.nytimes.com/2006/10/26/bu...rtner=homepage

LOL!!!

I mean $430 million is very painful, but that is quite the typo [rofl].

Sony loses more money than the pentagon...um..oops, he he

[spoddersedpn]

RiiiiIIIdge racer!

[RichardHaads]

MASSIVE DAMAGE!!!!

[Lhtfajba]

Time for Sony to do some... REAL TIME WEAPON CHANGE! [surrender]

[rushiddink]

The sad thing is, their stock only went up that day.....

[Rasklad]

Why should their stock necessarily go down? Because of a one time charge? Patient and prudent investors realize that this sort of event, namely the battery issue, is not part of normal operations for Sony and they look at the numbers exclusive of the charge. All businesses face challenges like this one from time to time and it doesn't makes them stronger, not weaker.

For example, I own an insurance company that I think has a very bright future but last year's hurricane season slaughtered this company's profits. For several quarters the company experienced significant losses as it paid claims and the stock market pummelled it. I was confident in the company's strength, though, and the fact that these hurricanes would tighten rates so I bought more. Now it's back to the price at which I originally bought it, except that my entry point is lower and the company's whole future is still ahead of it. And it continued to pay its dividends the whole time.

Sony's news is bad news, sure, but it's a one-time thing and selling a company you think is strong on the basis of a one-time charge would make you a foolish investor. There are a lot of foolish investors out there but it makes sense that the price shouldn't necessarily fall on this one piece of news.

[KukkoDrukko]

Why should their stock necessarily go down? Because of a one time charge? Patient and prudent investors realize that this sort of event, namely the battery issue, is not part of normal operations for Sony and they look at the numbers exclusive of the charge. All businesses face challenges like this one from time to time and it doesn't makes them stronger, not weaker.

For example, I own an insurance company that I think has a very bright future but last year's hurricane season slaughtered this company's profits. For several quarters the company experienced significant losses as it paid claims and the stock market pummelled it. I was confident in the company's strength, though, and the fact that these hurricanes would tighten rates so I bought more. Now it's back to the price at which I originally bought it, except that my entry point is lower and the company's whole future is still ahead of it. And it continued to pay its dividends the whole time.

Sony's news is bad news, sure, but it's a one-time thing and selling a company you think is strong on the basis of a one-time charge would make you a foolish investor. There are a lot of foolish investors out there but it makes sense that the price shouldn't necessarily fall on this one piece of news.

Totally agreed. Also, it doesn't go without saying every company out there is capable of making a large problem like Sony have done. Can be said for cars (even the big makes like Honda for e.g.), electronics and other stuff.

[rushiddink]

Why should their stock necessarily go down? Because of a one time charge? Patient and prudent investors realize that this sort of event, namely the battery issue, is not part of normal operations for Sony and they look at the numbers exclusive of the charge. All businesses face challenges like this one from time to time and it doesn't makes them stronger, not weaker.

Given that almost every other company's stock would react negatively on such news, it is a supprise. Many, MANY investors base stock value on the P/E ratio (I am going to assume you are not dumb on this stuff, so...), and almost every company out there would take a beating on such news. When you lose 400+ million in profits, you futures, at least short term, are not looking up. Why would you pay more for a company that has had, in the past few months:

- Setbacks on critical product launches (the BD player and PS3)
- Serious quality control issues
- Serious profit loss based on the above and other issues)

For example, I own an insurance company that I think has a very bright future but last year's hurricane season slaughtered this company's profits. For several quarters the company experienced significant losses as it paid claims and the stock market pummelled it. I was confident in the company's strength, though, and the fact that these hurricanes would tighten rates so I bought more. Now it's back to the price at which I originally bought it, except that my entry point is lower and the company's whole future is still ahead of it. And it continued to pay its dividends the whole time.

That is a different issue altogether though - the aftermath of the hurricanes, as you pointed out, gave a reason to expect a rebound. What about Sony's exploding batteries gives confidence of a rebound? What about Sony's constant delays give confidence about a rebound?

Sony's news is bad news, sure, but it's a one-time thing and selling a company you think is strong on the basis of a one-time charge would make you a foolish investor. There are a lot of foolish investors out there but it makes sense that the price shouldn't necessarily fall on this one piece of news.

Except you play this news as if it were small, which it is not. We are talking a HUGE loss in profits, which in turns means a BIG loss in the P/E for the stock. Perhaps the diehard holders see some light in the PS3 still; but even then, there is the looming question of meeting future and holiday demand - something which does not inspire confidence.