At least four brokers have rushed into downgrade Billabong following release of its results on Tuesday which showed a company in dire financial straits. Citi has downgraded BBG from Buy to Sell, High Risk due to the huge $859.5mm loss and further reduction for FY14 earnings. The broker has noted that the important factor for BBG is that it has avoided insolvency and the private equity interest is testament to the value in its brands. Both Deutsche Bank and J.P.Morgan have similarly downgraded BBG to Sell from Neutral despite results beating expectations. The brokers note that there is no guarantee the business can be turned around with any refinancing proposal expected to weigh heavily on FY14 earnings. Billabong is considering recapitalisation plans by US hedge funds Centerbridge and Oaktree. Its share price has fallen a massive 73.8% since its initial takeover offer from TPG back in 2012.