4 High Debt Stocks to Avoid

Debt has been a hot topic in the news in recent weeks. Whether it’s the possibility of a U.S. default, or austerity measures taken in Europe to avoid financial meltdown, debt levels are front and center on the investors psyche. With that in mind, today we look at five high debt stocks to avoid. Genworth Financial Inc. (GNW): A financial security company, GNW provides insurance and investment products both stateside and abroad. Shares traded up 0.96% to $8.40 at the time of writing, well off their 52 week high of $14.77 in July, 2011. In addition, GNW trades at a P/E ratio of 83.2. GNW’s debt has grown from $3.9 billion in 2006 to $8.9 billion in 2010. In the second quarter, GNW’s total revenue grew 10% to $2.67 billion from $2.41 billion a year earlier. However, the operating loss for the latest quarter stood at $74 million, compared with an operating profit of $118 million in the year-ago period. A significantly higher loss at the company’s mortgage insurance segment, partially offset by improved results at the retirement and international segments, resulted in the softened performance. We would avoid GNW primarily due to the fact the mortgage insurance business has significant…