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.

Value Investing & Hot Stocks MoneyLife Interview

We thought you might be interested in George Putnam's recent interview with Chuck Jaffe, senior columnist for MarketWatch and host of MoneyLife Radio's "Market Call." Jaffe's weekly columns are syndicated nationally, and his "Your Funds" publication is the nation's most widely-read column on mutual funds.

Jaffe notes, "Everyone loves the idea of a turnaround stock…a turnaround story, but there are specific things that go into a turnaround and that's part of the discipline that allows George to be successful at it….He's got his own definition for it and how it works."

The interview taps George's 30+ years of stock market experience for insight into the "specific methodology" and "discipline" behind his contrarian investing approach. Putnam discusses the troubled energy and retail sectors—with particular emphasis on Macy's vs. Sears: M has solid assets, management and cash flow while "we're not quite sure" how SHLD can solve its mounting challenges.

George notes that a solid turnaround stock prospect "needs new management, assets, improved cash flow or something else that will eventually allow the stock to level off and then rebound." Patience is key with a turnaround situation, however: "…Getting the timing right is extremely difficult….[We] tend to look at things in years rather than quarters."

The interview also shares George's thoughts on Turnaround Letter purchase recommendation General Electric (GE), market timing, the perils of a U.S. Bankruptcy Court filing and the necessity of broad diversification—among other topics. Jaffe concludes his interview with a spirited round of "Hold 'Em or Fold 'Em" to get George's take on listener stock picks, ETFs and mutual funds.

For direct access to a free MP3 of full interview, click the MoneyLife logo below:

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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."