Back in 2012, shares in the media company Trinity Mirror looked surprisingly cheap given the amount of cash the business was throwing off. Despite its outdated business model, the newspaper publisher was still managing to juggle a high level of debt and a troublesome pension deficit. But what was more concerning was its seeming inability to adapt to a digital age. Investors were nervous about how long the cash would keep flowing. On top of that, there were worries that it would get sucked into the industry’s phone-hacking scandal and end up facing stiff penalties or worse. Only those with a cast iron constitution were prepared to buy the shares. Many believed it was a value trap, even at such an apparently cheap price.
But despite the negative sentiment, shares in Trinity Mirror took off and it became a multi-bagger over the next two years. Opinions are still divided on whether it’s a business with a sustainable future. But what isn’t in doubt is that Trinity Mirror was a classic Turnaround play. It was in a class of shares that rebound in price from what can sometimes look…
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