Large Cap

Over $10 Billion


Stock moved to sell recommendation after successful plan implementation

Sale Recommendation - July 2018

This energy company is progressing through its turnaround plan, and we recommend the sale of its shares.
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This Swiss-based, large-cap manufacturing company is this month's stock pick.

Purchase Recommendation - April 2018

Despite the impressive new management, these shares fell sharply. This value stock's shares trade at a relatively modest valuation of 8x current year EBITDA. Although waiting for a five-year plan to unfold may seem as dull as watching cement dry, the shares pay an appealing 3.7% yield and should provide rock solid gains when the recovery is completed.
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First Data Made Progress in 4Q17

Data processing firm First Data Corporation (NYSE: FDC) continues to make progress with its revenue and EBITDA growth initiatives although debt paydown has been uninspiring.
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Viacom 1Q18 Results: Making Progress

The turnaround at media and entertainment company Viacom (NYSE: VIAB) rests on an improving balance sheet, combined with higher margins and revenue stability/growth, led by new CEO Robert Bakish. First quarter 2018 results showed progress in the first two, but some slippage in revenues.
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Ford Provides Details on 4Q17 Results—Turnaround On Track But Could Take A While

Ford Motor (NYSE: F) reported mixed results for the fourth quarter and full year 2017, reiterating its pre-announced results and guidance from the Detroit auto show earlier this month. Their turnaround under new CEO Hackett is in the early stages and remains on track. We don't anticipate meaningful financial progress for 2018 although the changes underway at Ford should become more visible. Subsequent to the release, Ford announced that Ford Credit's current CFO, Marion Harris, will become a senior officer at Ford Mobility as that group ramps up its staffing and funding. Also, Ford Mobility acquired Autonomic and Transloc, two technology firms that will help accelerate Ford's mobility efforts. We like the urgency and attention that this group is now receiving.
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Fuji Xerox Deal--Makes Sense But Picture Unclear--Moving to HOLD

Document technology company Xerox (NYSE: XRX) reported better 4Q17 revenues and profits. More strategically relevant: It announced that it will combine with long-time joint venture partner Fuji Xerox. Xerox shareholders will receive a cash dividend of approximately $9.80/share and will own 49.9% of the combined company. The combination makes a lot of sense to us as the Fuji Xerox partnership created an added layer of expenses and complexity that hobbled both its own success and Xerox Corp.'s performance. We're not entirely convinced that this deal will be completed, and the financial picture of the new combined company remains unclear; so we moving Xerox shares to a HOLD for now.
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Ford Provides Update--Turnaround Will Take A While

The update from Ford Motor (NYSE: F) in advance of next week's earnings report indicates that the company has a solid plan and financial strength (both earnings and balance sheet) to make its transition to higher profits and newer technologies. We believe the transition will be successful but will take time. Key variables are whether investors have patience to see it through, and will there be an auto industry down cycle that interrupts the transition.
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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.

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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."