Recommendation Updates

Follow the latest news on active Turnaround Letter purchase recommendations.

Large Cap / Pharmaceuticals, Biotechnology & Life Sciences

DuPont 2011 Financials Announced

On January 24, 2012, DuPont (NYSE: DD) reported financial results for the full-year 2011. 2011 earnings, before significant items, were up 20% to a record $3.93 per share versus $3.28 per share in 2010. Reported earnings per share were $3.68 versus $3.28 in 2010. Sales of $38.0 billion were up 20%, with a 27% increase in developing markets. The company generated $3.3 billion free cash flow in 2011 versus $3.1 billion in 2010, driven by increased segment operating income and productivity initiatives. For 2012, DuPont reaffirmed its earnings outlook range of $4.20 to $4.40 per share, which represents 7 to 12% growth versus 2011, excluding significant items. In the fourth quarter 2011, earnings were $.35 per share, excluding significant items, reflecting a $.23 per share year-over-year headwind from a higher tax rate. Prior year earnings were $.50 per share, excluding significant items. Reported fourth quarter 2011 earnings were $.40 per share, unchanged from the prior year. Fourth quarter 2011 sales grew 14% to $8.4 billion, principally from 14% higher local prices. Excluding significant items and Pharmaceuticals, segment pre-tax operating income increased over $100 million, or 18% in fourth 4Q11 versus the prior year, principally due to Performance Chemicals and acquisitions in Industrial Biosciences and Nutrition & Health. Fourth quarter 2011 net income attributable to DuPont was $373 million versus $376 million in the fourth quarter 2010. DuPont also reaffirms its full-year 2012 earnings outlook of $4.20 to $4.40 per share, an increase of 7 to 12% versus 2011, excluding significant items.

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Is there value in bankrupt PG&E’s stock?

In nearly every case, the shares of a company in bankruptcy become worthless. In very rare cases, however, they can become great investments. W.R. Grace (NYSE:GRA) shares produced a 75-fold return, as an example. With California utility PG&E (NYSE:PCG) now in bankruptcy, the range of possible outcomes for its equity is wide.

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EV/EBITDA: What Is It & Why Are We Using It More?

In reading recent editions of The Turnaround Letter, you have probably noticed that we are increasingly using EV/EBITDA as a valuation measure, rather than the better-known price/earnings multiple.  We thought it might be useful to describe this measure and why we like it.

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Turnaround Letter Stock Pick Named Top Performer of 2017

 

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What Last Year's Top Stock Pickers Are Buying in 2018

 

This Forbes write-up follows up on the recent Top Stock Tips report--naming The Turnaround Letter's Crocs recommendation the top performer of 2017: With 90% gains, CROX beat out 100 other investment ideas included in the report; and the stock continues to have value investing appeal, according to Putnam.

 

George notes, "We see additional upside for the stock in 2018 as management's efforts continue to bear fruit, though the gains will likely be more muted than we saw in 2017."