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Defense Stocks: Cliff May Not Be That Steep?


Want to know what George Putnam is recommending to readers of his Turnaround Letter? The articles previewed below offer you a sneak peak of the quality content and sound investment guidance you can trust. To view his most recent recommendations click here.



Defense Stocks: Cliff May Not Be That Steep?

As we approach the so-called “fiscal cliff,” investors are clearly very nervous about defense stocks. Most of the stocks in this sector fell very sharply after the election, and while they have bounced back somewhat since mid-November, they still look pretty cheap to us.

Of course, these investor concerns are not completely unfounded. If Congress and the White House cannot come up with a compromise and we go over the “cliff,” there would be mandatory cuts in federal defense spending. Our best guess--and we emphasize “guess”--is that Washington will find a way to avoid the cliff. But we also believe that most, if not all, of the risks from the cliff are already priced into defense stocks.

Also, many of the defense stocks spotlighted in our full-text, subscriber-restricted December 2012 Turnaround Letter pay healthy dividends, which should dampen any cliff-related volatility. Many of these hot stock picks have also been stockpiling cash over the last couple of years, which they could use to further enhance their dividends or to repurchase stock.


Read your free preview of The Turnaround Letter's most recent recommendations now!









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Turnaround Investing Blog

Return of Volatility? No, Return of "Normal"

Sizeable market moves can increase the temptation to sell on downdrafts and buy on upswings; however, we strongly advise against attempting to do that. The chances of getting out at the right time and then back in again before the market rebounds are extremely slim. Read More.

Harnessing Activists to Help Find Turnaround Stocks

Activist investors often produce attractive returns for their clients; and you can still use their influence to help your position as a turnaround investor in two ways: Buy a position in a stock with the expectation that an activist will soon follow or buy after an activist takes a stake.


Value Investing


While one of the many dozens of activist funds might find their way to selecting your particular stock, this approach is likely to be frustrating and unrewarding. A better approach is to buy after the activist makes their move. Once an activist takes a stake in a company, how do you evaluate whether it is worthwhile to follow on? Admittedly, this is a bit of an art... Learn how you can harness the power of activist investors to find market-beating turnaround stocks.

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."