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Sony Stock Downgraded to Junk Status

Fitch downgrades Sony's stock after worries on economic and a strong Yen.

It looks like THQ are not the only company in the technology market that are having a really really hard time, it also looks like Sony might be in a spot of trouble as well. Sony have just had their stock downgraded to junk status by well-known and respected rating company Fitch, the first group to label the corporation's shares as 'junk' as earlier in the month was Moody, another highly respected rating company, also downgraded Sony’s stock but not to junk status as with Fitch.

Junk status is not an officially defined, but normally refers to anything of BB status or below with a high risk of default and very little chance of any short or medium term gains. Fitch commented that "reflects Fitch's belief that meaningful recovery will be slow, given the company's loss of technology leadership in key products, high competition, weak economic conditions in developed markets and the strong yen,".

These conditions have hit Sony hard over the past year or two, partly prompting the promotion of former PlayStation boss Kaz Hirai to CEO and president of the group. Sony hopes to curb losses and build business by consolidating profitable areas of the business and building strategies for struggling branches such as flatscreen TVs. Due to a downward trend for both the games business and other core areas, Hirai's task is not getting any easier.