Today’s chart shows how much you can gain when a bad stock gets “less bad”…
Longtime readers know Steve’s “bad to less bad” strategy. After a company’s shares have plunged, even a partial recovery can mean a huge rally. You can find these opportunities when investors get over sudden fears, or when a struggling company finally posts some decent news. That’s what we’re seeing today…
Avon Products (AVP) is a 133-year-old beauty company.
Its “multilevel marketing” system means Avon largely counts on 5 million independent representatives to sell its goods.
The company lost money in four of the past five years on this outdated approach…
But now, Brazil-based Natura has agreed to buy Avon early next year.
And in the most recent quarter, Avon lost just $19.5 million on $1.2 billion in sales, beating Wall Street estimates.
That’s still not great… but it’s less bad. And while AVP shares are still far below their highs, they’ve tripled from their December lows. Once a stock is left for dead, it doesn’t take much for shares to soar…
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Source: Daily Wealth’s Market Notes