Bankruptcy News

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

Post-Bankruptcy Stocks / Healthcare Equipment & Services

Biovest International Plan Confirmed

The U.S. Bankruptcy Court confirmed Biovest International’s First Amended Plan of Reorganization, dated June 10, 2013. The Plan provides for, among other things, cancellation of all presently outstanding common stock in the Company, which common stock shall cease to trade or be recognized as an ownership interest in the Company as of the effective date of the Plan. In addition, the Plan provides for the conversion of virtually all pre-petition debt into new common stock of the reorganized Company, as follows: (i) all outstanding indebtedness due to the Company’s senior secured lenders, Corps Real and LV Administrative Services, totaling approximately $44.0 million, will be converted into new equity representing 93% of the issued and outstanding common stock in the reorganized Company; (ii) approximately $5.5 million of unsecured indebtedness outstanding under the Company's pre-petition unsecured debt obligations will be converted and exchanged for new equity representing 7% of the issued and outstanding common stock in the reorganized Company. The Plan further provides for the issuance of new shares of common stock in connection with the implementation of the Plan. The Company anticipates that it will emerge from bankruptcy in July 2013. This biotechnology provider filed for Chapter 11 protection on March 6, 2013, listing $4.7 million in pre-petition assets.

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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."