Write us at info@downside.com

Downside® deathwatch system

"Cash is king."

Is Deathwatch still being updated?
No. We've frozen the predictions as of January 1, 2001. Deathwatch remains as a record of the dot-com bubble.
What about companies whose death dates have passed?
The Deathwatch Vulture waits and watches.

They're dead, or close to death.Some were bought out by other companies at bargain prices. Some cut costs drastically and are on life support. Some have ceased operations. Some have taken on heavy debt. We note their fate on Deathwatch.

If you owned any of them, you're not happy.

How does Deathwatch work?

Deathwatch is an automated screen for money-losing companies running out of cash. It's based on the 10-Q quarterly reports filed with the Securities and Exchange Commission, retrieved directly from the SEC's online system, Edgar.

What are the criteria for Deathwatch?

The liquid assets (cash and securities) of the company are added to determine how much money it has left. This is divided by the losses for the quarter to determine how much time the company has before it runs out of money. The time left is added to the date of the last quarterly report to determine the death date. Selected companies are sorted in order of death date, soonest first, and reported on our Deathwatch page.

What does this predict?
When the cash runs out, something has to happen. There are only a few options - another public offering, taking on debt, a merger or acquisition, or bankrupcy. All those options are bad from a stockholder perspective. It's a valuable reality check for money-losing "growth" companies.
How can a company get off the Deathwatch list?

Report a profitable quarter.

How accurate is the data?

The fundamentals data is from official filings with the U.S. Securities and Exchange Commission. Companies do make errors in their filings; we've seen several companies report zero liquid assets to the SEC. (We note bad information where we are aware of it.) That's their error and their problem; if they file a corrected 10-K or 10-Q, like they're supposed to, we'll pick it up on our next scan. The market data shown is simply a link to NASDAQ, with which we have no connection, and we are not responsible for that data.

.Please let us know of any other errors.