A noteworthy entrant to the distressed ranks is Xerox (XRX) – in the 1980s, the copier producer’s stock was one of the greatest performers ever, registering an astounding 4,500-fold gain in the 50 years through its all-time high on May 3, 1999. Xerox’s senior debt is now on the watchlist for downgrading.
In April, we recommended selling the bonds of this e-commerce business at $878 – which we had recommended buying four months earlier at $840. They have since fallen dramatically. In this report, we are recommending buying them back. And we explain why the price of the bonds has dropped and why we think it will rise again.
Innovations of the past few decades have created many outstanding opportunities in distressed investing. To ease the pain of distress, financial entrepreneurs created new procedures to reduce the cost of fixing broken balance sheets – all to the benefit of individual investors.
The company whose bond we recommended in February and whose stock we are recommending in this issue has made a strong turnaround – plus, it has recently made three related purchases that should further help its profits… and share price.
Asymmetric information is something you must avoid falling prey to as an investor. There are laws protecting individual investors, but there are still ways to get caught on the wrong side of a transaction.
In the heart of America’s Corn Belt, the company whose bond we recommend in this issue has quietly transformed itself from a traditional ethanol producer into a biotech innovator – unlocking more from every kernel of corn than anyone thought possible.
In the heart of America’s Corn Belt, the company whose bond we recommend in this issue has quietly transformed itself from a traditional ethanol producer into a biotech innovator – unlocking more from every kernel of corn than anyone thought possible.
An investor who consistently beats the market needs others to be consistently on the wrong side of the trade. Don’t persist with a strategy that makes you the one who’s making money for someone else, Distressed Investing editor Marty Fridson writes.
In this special edition of the Daily Journal, Martin Fridson, Wall Street’s Dean of High Yield, shows how companies looking to raise capital tend to issue new bonds into an environment that benefits them, and not investors. Marty uses his decades in the sector to provide insights into how you can get in on the right side of the bond market.