Footstar, Inc.
Thesis
Footstar, Inc. emerged from bankruptcy with a large cash balance and no outstanding debt, making it an attractive investment opportunity. The company has significant net operating loss carry forwards that provide a tax shield for potential acquirers, and its proprietary brands, particularly Thom McAn, hold substantial value. The adjusted present value of the company under a liquidation scenario suggests a favorable risk-reward profile for investors.
Did it work?
The investment thesis for Footstar, Inc. has played out successfully, as evidenced by the significant price increase of 525.2% since the pitch. The company's emergence from bankruptcy with a strong cash position and no debt, along with the value of its proprietary brands and tax advantages, has likely contributed to this positive performance. Given that 229 months have elapsed, which is well beyond any reasonable investment horizon, the thesis can be confidently deemed successful.
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