Bankruptcy News

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

Bonds / Media

RDA Holding Plan Confirmed

The U.S. Bankruptcy Court confirmed RDA Holding’s Second Amended Joint Plan of Reorganization, and the Company expects to emerge from Chapter 11 protection at the end of July 2013. Robert E. Guth, Company C.E.O., states, “We are taking decisive actions that are placing our business on a stronger path for the long-term and making us a more relevant and more profitable Company. We have used the restructuring period to reset and refresh our Company and have reconsidered nearly every aspect of our business.” Upon emergence, the Company will have reduced its debt by over 80% from approximately $500 million to approximately $100 million and have a stronger cash position and converted approximately $465 million of secured notes to equity. In addition, it will focus solely on its most profitable core businesses after shedding non-core and less profitable. The Company states that it has also made great progress in re-aligning its corporate infrastructure with its more narrowly defined mission. Guth continues, “The speed with which our restructuring plan proceeded reflects the unanimity of purpose among our stakeholders about our path forward, and we are very grateful for their support.” This global media and direct marketing provider filed for Chapter 11 protection on February 17, 2013, listing $1.6 billion in total assets.

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Turnaround Investing Blog

IBM: Not Yet Time to Swing at this Pitch

IBM’s stock underperformance since IBM’s current CEO took the helm in 2012 has been stark, with the shares declining 23% while the S&P500 Index has more than doubled. One big problem: revenue growth rate is zero, at best. Without revenue growth, what’s left to entice investors? The real driver of value at IBM – free cash flow that is used to repurchase shares. Can IBM borrow its way to shareholder prosperity as its cash flows shrink? What to do with IBM shares? Wait for a better pitch in the form of a catalyst or much lower valuation. Read More.

Comparing Stocks Vs. Bonds

While the common stock of a turnaround candidate usually has the greatest upside potential, other classes of securities, such as bonds or preferred stock, may offer attractive profit possibilities with less risk. Many turnaround companies have only one class of securities available to investors but where there are different classes to choose from, it can pay to do a little extra analysis of the various options.

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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."