Turnaround Investing Blog

George Putnam, one of the country's leading turnaround and distressed investing professionals, shares his timely insight on the economy and turnaround investing opportunities.

Worry About What You Can Control

There’s a lot to worry about right now out there in the financial world. The European debt problems, the volatility in the stock market and the gridlock in Washington are probably at the top of many worry lists. You can lose a lot of sleep worrying about matters like these, but it won’t do you much good because you can’t really change any of them. Instead, you should worry about the things that you can control.

For example, you can make sure that your portfolio is well diversified and that you have the right balance between asset classes. You can evaluate your insurance coverage to make sure that it covers your current needs. You can review your estate plan to make sure it is up-to-date and takes advantages of the current wrinkles in the tax code.

At a more granular level, you can re-examine the holdings in your portfolio. Are there any holdings whose risk level has increased due to recent events--for example, European banks or insurance companies? Are there any stocks that you’ve thought about buying in the past that have been beaten down to attractive levels? For example, see the articles about the Dividend Aristocrats and Post-Bankruptcy Stocks in the September 2011 issue of the newsletter.

Not only will you lose less sleep if you don’t worry about the things you can’t change. You’ll probably feel much better if you take some active steps to improve your financial health.

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Amazon = US GDP 1970

Amazon joined Apple in reaching a $1 trillion market capitalization. $1 trillion is about the same as the total value of New York City property and the total value of loans at JP Morgan, the nation’s largest bank in terms of assets. Jeff Bezos’ $160 billion stake would place him (personally) as the #33 largest company in the S&P 500 in terms of market cap, next to Coca-Cola, Disney and Netflix. We aren’t bold enough to predict whether the shares will continue upwards or if they are in a bubble reaching maximum inflation. Setting aside for a moment their investment prospects, let’s admire the truly remarkable milestone that these two companies have reached. Read More.

EV/EBITDA: What Is It & Why Are We Using It More?

In reading recent editions of The Turnaround Letter, you have probably noticed that we are increasingly using EV/EBITDA as a valuation measure, rather than the better-known price/earnings multiple.  We thought it might be useful to describe this measure and why we like it.

Read More.

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."