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

Anchor BanCorp Wisconsin Plan Effective

Anchor BanCorp Wisconsin’s Prepackaged Bankruptcy Plan of Reorganization became effective, and the Company emerged from Chapter 11 protection. The Court confirmed the Plan on August 30, 2013. “We have been aggressively working for four years to get to this point, and we’re proud that the recapitalization effort is now complete, positioning AnchorBank for a full return to profitability and growth,” comments Chris Bauer, president & C.E.O. for AnchorBank. Bauer came out of retirement in 2009 to lead the recapitalization effort, which included reorganizing and recruiting a new senior management team. According to documents filed with the Court, “Pursuant to the Plan, the Company will discharge its senior secured credit facility with approximately $183 million in outstanding obligations for a cash payment of $49 million. In addition, the Company’s TARP preferred securities with an aggregate liquidation preference and deferred dividends of approximately $139 million will be cancelled in exchange for new common equity that will represent approximately 3.3% of the pro forma equity of the reorganized Company. New equity investors will represent in the aggregate approximately 96.7% of the pro forma equity of the reorganized Company. As of July 31, 2013, the Company had 21,247,225 shares of common stock issued and outstanding, all of which will be cancelled for no consideration pursuant to the Plan of Reorganization.” Also pursuant to the Plan, the Company converted from a Wisconsin corporation to a Delaware corporation in accordance with Section 265 of the Delaware General Corporation Law. In connection with Plan effectiveness, James Smessaert, Leonard Rush and Duane Morris each resigned as members of the board and all committees thereof. This bank holding company filed for Chapter 11 protection on August 12, 2013, listing $2.4 billion in pre-petition assets.

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Turnaround Investing Blog

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."