MOODY’S MAY DOWNGRADE SONY TO JUNK

Moody’s Investment Services has warned that it could downgrade Sony’s credit rating to junk. The warning comes after Sony reported losses from its movie business, one of the few company divisions that had previously been performing well. In a statement, Moody’s said, “Weak earnings across the majority of reporting units suggests the potential for a much longer period of restructuring and financial weakness than previously expected.” Today’s (Monday) Wall Street Journal observed that while Sony’s recently quarterly loss was mainly due to its movie business, “what is worrying analysts and investors is the bleak outlook for its consumer electronics.” It quoted Takuya Yamada of Astmax Asset Management as saying, “Movies are in many ways a hit-and-miss, but it’s the structurally troubling electronics division that’s disappointing.” And a fix for that division, some analysts suggest, currently appears out of reach.