Recommendation Updates

Follow the latest news on active Turnaround Letter purchase recommendations.

Automobiles & Components / Mid Cap / Post-Bankruptcy Stocks / Materials

Calpine Financials Released

On February 10, 2012, Calpine Corporation (NYSE:CPN) reported fourth quarter 2011 adjusted EBITDA of $379 million, compared to $386 million in the prior year period, and adjusted recurring free cash flow of $108 million, compared to $59 million in the prior year period. Net loss for the fourth quarter narrowed to $13 million, or $0.03 per diluted share, compared to $24 million, or $0.05 per diluted share, in the prior year period. Net loss, as adjusted, for the fourth quarter of 2011 was $43 million compared to net income, as adjusted, of $62 million in the prior year period. Full year 2011 adjusted EBITDA was $1,726 million, compared to $1,712 million in the prior year. Full year 2011 adjusted recurring free cash flow was $489 million, compared to $558 million in the prior year, a decrease mainly due to higher scheduled major maintenance expense and capital expenditures in 2011 compared to 2010. Net loss for the year was $190 million, or $0.39 per diluted share, compared to net income of $31 million, or $0.06 per diluted share, in the prior year. Net loss, as adjusted, for 2011 was $13 million compared to net income, as adjusted, of $87 million in the prior year, a decline primarily due to a reduction in income tax benefit, as previously discussed. As of December 31, 2011, the company reported $2.0 billion in liquidity, down from $2.2 billion as of December 31, 2010. Calpine states that it is “tightening” its 2012 guidance, including raising the lower end. Calpine now projects adjusted EBITDA of $1,600 million to $1,725 million and adjusted recurring free cash flow of $425 million to $550 million. Calpine also expects to invest $10 million, net of debt funding, in growth-related projects during the year.

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Identify & Profit from Distressed Investing

Free Report: Turnaround Investing Mistakes

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Turnaround Investing Blog

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."