Case | HBS Case Collection | October 1991 (Revised November 1993)

Dynashears, Inc.

by Thomas R. Piper

Abstract

A senior loan officer is reviewing the recent performance of a company that has failed to repay its loan as scheduled. The failure results from a cyclical downturn in sales, coupled with a lag in cutting back production. Inventory risk is minimal. Teaching objective: Practice in financial analysis and in understanding the impact of business cycle on durable goods companies. Also an opportunity to evaluate the situation from a lender's perspective. A rewritten version of an earlier case.

Keywords: Borrowing and Debt; Business Cycles; Financial Condition; Risk and Uncertainty; Failure;

Citation:

Piper, Thomas R. "Dynashears, Inc." Harvard Business School Case 292-017, October 1991. (Revised November 1993.)