You should almost never buy the stock of a company in Chapter 11. The only possible exception is if you are a very daring short-term trader. Even if a company successfully emerges from Chapter 11, rarely is there enough value in the reorganized company to make the old stock worth anything.Read More
While there is no hard and fast definition of a “penny stock,” the term refers to a stock selling at a very low dollar price. Some people would say that a stock must be trading below $1.00 per share to be a true penny stock; others might include stocks trading below $5.00 per share. The term penny stock often has a negative connotation because...Read More
This question is a little too philosophical for us to tackle. But it was prompted by a weird coincidence that we do want to examine.
There is an old investors’ maxim that goes something like “The stock market has forecast ten of the last five recessions.” We don’t know if the U.S. economy is going into (or already in) another recession....
The short answer is “no.” However, I am always very cautious about turnarounds in heavily regulated industries such as banking and insurance.Read More
I don’t like the term “play” money because I always consider money and investing to be serious subjects.Read More
I often find selling harder than buying. You should periodically review each position in your portfolio and ask yourself the following questions...Read More
It is difficult to generalize since every company is different.Read More
Unlike some other credit cycles which were dominated by certain industries (such as telecom and tech companies in the 2000-2003 cycle), right now I don’t see any particular sectors...Read More
We do not claim any expertise in economic forecasting--and those who do claim such expertise usually get it wrong--but that doesn’t stop us from having some views on the economy.
Identify & Profit from Distressed Investing
Turnaround Investing Blog
At first glance, the shares have decent appeal as a turnaround investment. Looking deeper, however, the fundamentals are not as strong and stable as they appear. Surplus cash flow is tight, a key driver is weakening, it is increasingly reliant on China and has other nagging issues. We don’t see the new CEO as a catalyst for change. Despite the “first glance appeal”, Tupperware isn’t a good fit as a turnaround stock.
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.
Turnaround Letter Stock Pick Named Top Performer of 2017
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."
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