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.

Mid Cap / Pharmaceuticals, Biotechnology & Life Sciences

Free Turnaround Letter Research Report: Bioverativ (NYSE: BIVV)

In addition to our ongoing market commentary, analysis of specific sectors & industries and monthly value stock picks, Turnaround Letter subscribers also have access to institutional quality Purchase Recommendation Research Reports and Updates for all companies in The Turnaround Letter's portfolio. We're sharing this complimentary copy of our full Research Report for Bioverativ (NYSE: BIVV) for your reference—20+ pages of financial analysis, investment philosophy and straightforward explanation. BIVV, our most recent closed out purchase recommendation, brought Turnaround Letter readers 95% stock profit in seven short months.

We added this mid-cap pharmaceutical to our active portfolio in April 2017 because Bioverativ had value investing appeal, which is often true of spinoffs. BIVV also had many of the key traits of a successful spin-off: healthy revenue, profit margins and cash flow; a solid capital base; an impressive leadership team and strong R&D, marketing and regulatory capabilities. As an added bonus, Bioverativ even had a highly-regarded, long-term focused activist firm recently take a 7.5% position.  

When analyzing the stock pick, Putnam emphasized, "…following its two-year post-spin waiting period (to preserve tax benefits), Bioverativ could be an appealing acquisition target for larger pharmaceutical companies looking for quality franchises." That prediction soon materialized: In late January 2018, BIVV announced a definitive agreement to be acquired by Sanofi.

Putnam immediately moved the stock to "Hold" status and updated Turnaround Letter readers: "The deal looks solid.….Given the very low risk that the deal is terminated, we are moving Bioverativ to a HOLD, rather than a Sell on the possibility (however remote) of a higher bid from another buyer."

It soon became clear that there was little chance of that, and Putnam advised readers to promptly lock in 95% gains to avoid any risk that the deal might fall through. With BIVV's sale recommendation, 2018's average profit on closed out stock picks stands at 47%

Subscribe now for immediate access to Research Reports and Updates on all of The Turnaround Letter's value stock Purchase Recommendations.

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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."