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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.