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2013 Stock Picks: Small Caps with Big Rebound Potential
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.
While much of the stock market is quite efficient--meaning information is well distributed, and so it is hard to get an edge and outperform--there are certain niches that are less efficient. As we’ve often said, turnaround stocks represent one of those inefficient niches because they require a mindset that most mainstream analysts don’t have. Small capitalization stocks can also be less efficient. Their small size and lower levels of trading liquidity make them impractical for large investment funds to own, and so there are fewer analysts following them.
If you combine these two sources of inefficiency, it stands to reason that small-cap turnaround stocks should be particularly inefficiently priced. Since inefficiency usually equates to abnormally high return potential, that makes these stocks particularly interesting.
The January 2013 issue of The Turnaround Letter details eight 2013 stock picks culled from the worst performers in the S&P SmallCap 600 this past year. These turnaround investment opportunities all offer solid businesses, decent balance sheets and good rebound potential. Access the full subscriber-restricted version now.
Read your free preview of The Turnaround Letter's most recent recommendations now!