Originally Posted by
SmitteyB
Hmmm, AMR Corp was in a perpetual cycle of quarterly losses.
The companies debt liabilities exceeded their liquid and non-liquid assets. The company was insolvent.
Same thing happened to PNCL Corp.
RAH is not insolvent. In fact they has positive cashflow and are still, as of now, reporting EPS 4 cents. Minute, yes, but still solvent.
My point being that it is easy for a company of that size to show a loss... they were showing a loss while at the same time increasing their cash horde.
Debt exceeding assets doesn't always make a company insolvent... being unable to pay debt obligations does that. AMR was not close to defaulting on any debt.