Bankruptcy News

We've summarized the latest docket activity and news for publicly traded companies currently operating under U.S. Bankruptcy Court protection.

Bankruptcy/Chapter 11 / Banks / Diversified Financials / Post-Bankruptcy Stocks

Washington Mutual Plan Confirmation Indicated

Washington Mutual (WMI) announced that the U.S. Bankruptcy Court will enter an order confirming the Company's Seventh Amended Joint Plan of Affiliated Debtors pursuant to Chapter 11 of the United States Bankruptcy Code (as has been modified). The Court also approved certain modifications contained in the Plan that were agreed to during a recent mediation by and among the Debtors, the official committees of unsecured creditors and equity security holders and certain significant parties in the Company's Chapter 11 proceedings. The Plan will become effective after the Court enters a written order reflecting the confirmation ruling and certain Plan conditions have been satisfied. Under the Plan, WMI will establish a liquidating trust to make distributions to parties-in-interest on account of their allowed claims. The Company, and subsequently the liquidating trust, will distribute funds in excess of approximately $7 billion. The Plan will result in significant recoveries for the estate's creditors and distribution of substantially all of the stock in the reorganized company to current equity holders. William C. Kosturos, chief restructuring officer of Washington Mutual, comments, "Approval of the Plan represents a monumental achievement for the Company and its stakeholders. The Company is gratified by the Bankruptcy Court's approval and is looking forward to implementing the Plan and initiating the distribution of recoveries to the Company's creditors and equity holders."

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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."