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 / Bonds

Residential Capital Plan, Notices Filed

Residential Capital and its official committee of unsecured creditors filed with the U.S. Bankruptcy Court a Second Amended Joint Chapter 11 Plan. A related Disclosure Statement was not filed as a result of the August 23, 2013 Court order approving the Disclosure Statement. According to the Plan, “The Second Amended Plan, among other things, reflects a settlement (the ‘JSN Settlement’) among the Plan Proponents and certain of the Junior Secured Noteholders, the Ad Hoc Group, the Junior Secured Notes Indenture Trustee, and the Junior Secured Notes Collateral Agent (each as defined in the Second Amended Plan). The JSN Settlement has the support of Ally and certain of the Consenting Claimants and resolves the JSN Adversary Proceeding as well as the pending objections to confirmation filed by the Junior Secured Notes Indenture Trustee, the Junior Secured Notes Collateral Agent and the Ad Hoc Group.” The Company also filed a notice of proposed resolution of litigation regarding JSN claims and the opportunity to change votes with respect to its Second Amended Joint Plan. The notice asserts, “The details of the proposed settlement are set forth in the Second Amended Plan but, generally, provide, in addition to the treatment already prescribed in the Plan, for the payment to the holders of Junior Secured Notes Claims of a sum certain on account of post-petition interest, fees, and charges and the granting of certain releases and exculpations to certain parties, including the Junior Secured Noteholders that vote to accept the Second Amended Plan.” Residential Capital also filed a notice of satisfaction of secured claims, which asserts, “The Debtors are serving this Notice on all claimants holding Satisfied Claims (‘Claimants’) to provide them with an opportunity to object to the Debtors’ determination that such claims have been satisfied.” Residential Capital seeks a December 11, 2013 hearing to consider the Plan.

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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."