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.

Exchange Traded Funds (ETFs) / High Yield Bonds

Mid-Year Stock Market Review: Is Recent Volatility a Blip or Trend?

Excerpted from July 2013 Issue

We don’t put much faith in market forecasts, even our own.  But the forecasts that we made at the beginning of the year look pretty good right now.  In the January issue we said “We remain quite optimistic about the stock market for 2013,” and as we write this, the S&P 500 index is up about 13% for the year to date.  We also said, “We remain wary of high yield bonds,” and we expanded on our concerns in the February issue.  So far this year, the high yield market has been fairly weak.  One of the largest high yield bond ETFs, the SPDR High Yield Bond ETF (symbol JNK) is down about 2.5% in price, and with dividends it is about flat for the year.

It is also worth noting that our “year-end bounce” picks that we made in our December investment newsletter have done particularly well this year.  Eight of the ten year-end bounce candidates that we identified are up so far this year, and the group is up an average of 33% year-to-date, well outpacing the broader market.

But that’s enough of patting ourselves on the back for some good calls at the beginning of the year.  Let’s turn to what we expect for the second half of 2013. While most of the last six months have been relatively placid and profitable for investors, the past couple of weeks have been quite different.  When Fed Chairman Ben Bernanke mentioned in mid-month that the Fed was likely to begin cutting back its bond purchasing program later this year, that spooked both the stock and bond markets.  In the week and a half since Bernanke’s speech, the stock market has become very volatile with the Dow Jones Industrial Average moving by more than 100 points every day except one.  While the volatility has gone in both directions, the market is still down about 2.7 percent since the speech.  The bond market has been hit even harder.  We wouldn’t be surprised to see some of this volatility...

Read Putnam's full stock market forecast---and related "Mid-Year Bankruptcy Update."

Read More Distressed Investing Blog Entries

Identify & Profit from Distressed Investing

Free Report: Turnaround Investing Mistakes

Turnaround Investing Blog

Turnaround Investing Blog

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

 

stock market advicex

 

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."