The Turnaround Letter

June 2017

Volume: 31
Edition: 12

Stock Pick & Stock Sales

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The current annual dividend will compensate investors while they wait for results to improve further.

Purchase Recommendation - June 2017

Despite this large cap stock pick’s problems, its brand and core franchise remain strong: The restructuring efforts are beginning to show promising results although the pace remains slow. Costs are coming down, the company is seeing better net inflows, overall management is tighter and capital raises have bolstered the balance sheet. While the shares carry significant risks due to the leveraged nature of operations and its sensitivity to the capital markets, we see considerable upside potential if the turnaround is successful.
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Turnaround Investing Articles

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Small cap stocks have generally been laggards this year. 

Digging Through The Small Cap World

We thought we’d take a stroll through the small cap world to see if the market is missing anything.  Our focus was to find stocks that have weak recent performance but attractive valuations, where the company has reasonably stable operations and there is some catalyst or other driver to push the stocks higher.  We limited our search to companies with market caps below $1 billion and emphasized two of our favorite hunting grounds for value: the consumer and industrial sectors. Many potential candidates deserve their cheapness because of highly vulnerable business models, but we did find a few others that looked like potential winners.
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These seven companies offer stock profit potential with the Puerto Rico bankruptcy.

Puerto Rico Government Bankruptcy: Uncertainty But Also Opportunity

Because of special tax law provisions that exempt the territory’s debt from not only federal taxes but also state taxes in every state, the bonds are widely held by investors across the country. Since the legal action is under a new law that has never been tested, there is tremendous uncertainty about how much creditors will recover and how long the process will take, but there may be opportunities for stock investors to profit from the island’s restructuring as well--perhaps with less downside risk than in many of the bonds. We found four public companies based in Puerto Rico that could benefit from stabilization in the island’s finances as well as three major insurance companies with exposure to Puerto Rican debt. 
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Turnaround News & Updates

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Stocks are often somewhat weak after a reverse split.

News Notes & Updates - June 2017

We still like this large cap stock and would view any post-split weakness as a good opportunity to buy more. 
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Learn George Putnam's Turnaround Secrets

Free Report: Learn Value Investing Secrets Free

Turnaround Investing Blog

Turnaround Investing Blog

Puerto Rico Government Bankruptcy: Uncertainty But Also Investing Opportunity

Because of special tax law provisions that exempt the territory’s debt from not only federal taxes but also state taxes in every state, the bonds are widely held by investors across the country. Since the legal action is under a new law that has never been tested, there is tremendous uncertainty about how much creditors will recover and how long the process will take, but there may be opportunities for stock investors to profit from the island’s restructuring as well--perhaps with less downside risk than in many of the bonds. We found four public companies based in Puerto Rico that could benefit from stabilization in the island’s finances as well as three major insurance companies with exposure to Puerto Rican debt. Read More.

Market-Beating Profit: The 200+ Club

Turnaround stocks present a unique opportunity for savvy investors to buy in at bargain prices. Take a look at this list of just a few of our purchase recommendations that have realized a return rate of 200% or better:

Value Investing Stock Profit

* Bristow remains in our active portfolio (currently as a Hold), and 2,320% gain is as of 4/11/17.

Five Struggling Stocks That Will Turn Around

 

stock market advicex

 

Kiplinger points out that despite the post-election stock market surge, not all stocks have benefited from the uptick: "More than 100 issues in the S&P 500 have fallen in price this year, including dozens that have slumped by more than 10%....Yet these stocks won’t all stay in the dumps forever. Some will mount a comeback in 2017, making it an opportune time to try to identify the best candidates."

 

Quoting George Putnam, Kiplinger details five value opportunities for the new year.

 

Learn more about Putnam's investing success with turnaround stocks.