Martin Fridson

Right now, the industry that produces the key ingredient for everything from Oreo cookies to living-room paint is near the bottom in operating profit and share price. This distress creates the opportunity to recommend shares of one the leaders (a century-old business) in the production of this chemical.

The bankruptcy court’s decision in an ongoing case that Marty Fridson reports on this month may provide some guidance on what to expect if a similar situation arises in distressed bonds in the future. Keeping on top of these developments is an important part of the task of identifying the best opportunities in distressed securities.

The price of the bond featured this month has fallen sharply during the year – but our team believes the bond represents solid risk-adjusted value at current prices. We think the bond will ultimately be valued materially higher than it is today.

In looking at the distressed-bond market today, Marty Fridson suggests: Fasten your seatbelts. It’s going to get very bumpy. But investors who remain rational will profit extravagantly from the foreseeable disconnect between value and price in the lower-quality end of the corporate bond market.

Investors are concerned that the products of the company featured this month are on the wrong side of history and condemned to permanent decline. This report will explain how the company is reinventing itself – and will remain a survivor – and propelling the price of its bond higher.