Why enrons stock dropped so dramatically in a short time

Reference no: EM13899844

Enron Corporation, headquartered in Houston, Texas, provides products and services for natural gas, electricity, and communications to wholesale and retail customers. Enron's operations are conducted through a variety of subsidiaries and affiliates that involve transporting gas through pipelines, transmitting electricity, and managing energy commodities. The following data were taken from Enron's December 31, 2000, financial statements.

	In millions
Total revenues	$100,789
Total costs and expenses	98,836
Operating income	1,953
Net income	979
Total assets	65,503
Total liabilities	54,033
Total stockholders' equity	11,470
Net cash flows from operating activities	4,779
Net cash flows from investing activities	(4,264)
Net cash flows from financing activities	571
Net increase in cash	1,086

At the end of 2000, the market price of Enron's stock was approximately $83 per share. As of April 17, 2005, Enron's stock was selling for $0.03 per share.

Review the preceding financial statement data and search the Internet for articles on Enron Corporation. Briefly explain why Enron's stock dropped so dramatically in such a short time.

Reference no: EM13899844

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