13 Great Companies To Invest In That Almost Lost It All

John Csiszar

Opening a business is a risky proposition, and many companies don’t survive more than a few years. Only a handful of companies succeed to the point that they become household names, and every company listed below has reached that magical summit. But, would it surprise you to know that every company on this list also has flirted with — and some actually filed for — bankruptcy? Even some of the largest, most well-known companies in America have had their struggles, but these 13 have fought their way through and survived — and now they might be wise investments for you.

Last updated: Oct. 9, 2019

Apple

Apple is a Wall Street darling, so it could come as a shock to many investors that the company was once at death’s door. In 1995-96, numerous media outlets were picking on Apple and predicting its demise, from Fortune to Time to Business Week. The company was losing out to competitors such as Microsoft, and in the final quarter of 1996, sales plummeted by 30%. It took the return of legendary CEO Steve Jobs in 1997 to revamp the company and keep it from collapsing.

Why Apple Is Worth Investing In

  • Stock Price: $223.97

Nowadays, Apple is one of the undisputed market leaders. In fact, depending on the day of the week, it’s currently either the most valuable company in the world or the second-most valuable; it’s in a constant back-and-forth with competitor Microsoft. The company earned nearly $60 billion in profit in the fiscal year 2018 alone. On financial news programs, Apple frequently is discussed as one of the barometers of overall market health. Apple has gotten to this leadership position on the back of a ramped-up product line, ubiquitous acceptance of its iPhones and expansion of its services.

Best Buy

Best Buy probably is one of the most unlikely companies to appear on the resuscitated list as the move to online shopping has decimated the brick-and-mortar retail industry. Best Buy was one of the first companies to be associated with the word “showrooming,” in which customers would visit a store’s physical location to touch and feel a product and then go home to buy it for a cheaper price from an online competitor, such as Amazon. By 2012, the company was dying a slow death.

Why Best Buy Is Worth Investing In

  • Stock Price: $68.99

Best Buy has proved to be one of the most resilient companies in the world, bouncing back from this huge fundamental shift in the way people buy to become a thriving retailer. Although the company faces continual headwinds from competitors, changing customer needs and tariffs, its CEO projects the company will reach $50 billion in revenue by 2025.

IBM

IBM long was considered one of the safest companies in the world, the “bluest of blue chips” and a longtime member of the collection of 30 elite stocks that make up the Dow Jones Industrial Average. As recently as 1985, the company also made up 6.4% of the weighting in the S&P 500 index. Times got hard for “Big Blue” in the early 1990s, however, as it was hemorrhaging money. In 1992, the company lost $5 billion, which at the time was the largest corporate loss in history.

Why IBM Is Worth Investing In

  • Stock Price: $145.41

A new CEO and a renewed focus on its increasing competition helped turn IBM around in the late 1990s, and it still remains a member of the venerable Dow Jones Industrial Average. Its importance has diminished, as newer and fresher tech stocks have taken the public stage, but IBM continues to innovate and adapt.

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AIG

AIG, formally known as American International Group, was one of the mighty companies that got taken down during the financial crisis of 2008. AIG was one of the companies that were considered “too big to fail” as it backed insurance policies for millions of Americans. The federal government had to step and provide $67.8 billion to bail out the company in 2008 to prevent it from going bankrupt.

Why AIG Is Worth Investing In

  • Stock Price: $55.70

Times have changed for AIG in the past decade. After accepting the emergency government buyout, the company had the flexibility to get back on its feet and ended up paying back all of the government money it accepted, plus interest. As of 2018, AIG was back on top as the leading seller of annuities in the country.

General Motors

General Motors is one of the companies that helped build America, providing jobs to millions of workers over the years and contributing enough automobiles to make it one of the “Big Three” in the American auto industry. However, the global recession and financial crisis of 2008 pushed GM right to the edge of bankruptcy. Only a $50 million bailout from the federal government helped to save the company from oblivion.

Why General Motors Is Worth Investing In

  • Stock Price: $37.47

Once the world sorted itself out and a new economic expansion began, car buyers returned to GM in droves. Earnings continue to surprise on the upside, and management raised the company’s earnings outlook for 2019. The automakers are particularly susceptible to the economic cycle, so if there is a recession in 2020, it could slow GM’s growth; however, the company is far from the condition it was in back in 2008.

Jack in the Box

Jack in the Box had a long road to climb to win back consumers. In a series of tragic cases, unsanitary food handling led to an E. coli outbreak in 1993 that ultimately sickened more than 700 people and killed four. This halted the company’s rapid expansion and instead led to layoffs and plummeting sales. With so much competition available for the fast-food dollar, some pundits expected the end of Jack in the Box.

Why Jack in the Box Is Worth Investing In

  • Stock Price: $91.12

Rather than crawl into its own box, Jack turned things around, introducing a new marketing campaign and revamping its food-handling procedures. Jack in the Box was one of the first fast-food companies to announce that it would cook food on an as-ordered basis, increasing wait times but improving freshness, safety and overall quality. Sales now are booming, and the stock price skyrocketed in 2019.

Citigroup

Citigroup, once the largest bank in the world, was crushed by the financial crisis of 2007-08. Its stock price ultimately plunged below $1 per share in March 2009. Things could have been worse — fellow industry veterans Washington Mutual, Bear Stearns and Lehman Brothers all collapsed during the crisis — but it took a huge government bailout to save Citigroup, deemed “too big to fail.” The company lost more than $20 billion in 2007, and the U.S. government had to agree to absorb losses on an additional $306 billion in risky assets to shield the company.

Why Citigroup Is Worth Investing In

  • Stock Price: $69.09

Citigroup has recovered since the financial crisis, with its share price moving steadily higher, albeit slowly. The stock might never recover its all-time highs, but it has risen by a dividend-adjusted 54% since a 1-for-10 reverse stock split in 2011. The company also has purged all of the toxic investments that led to its downfall from its balance sheet.

Marvel

Marvel always has been known for its line of comic book superheroes. However, in the 1980s and ’90s, the company wasn’t very successful at parlaying those assets into revenue. After a decline in comic book readership and the production of a few lackluster movies that can’t compare with what the studio produces today, Marvel Entertainment Group headed for Chapter 11 bankruptcy protection in 1996.

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Why Marvel Is Worth Investing In

  • Stock Price (Marvel): N/A, privately held subsidiary of The Walt Disney Co.
  • Stock Price (Disney): $130.30

Marvel now is one of the biggest names in movies, releasing blockbuster after blockbuster in its line of superhero movies. The first “Iron Man” film (2008), starring Robert Downey Jr., kick-started an entire franchise that recently culminated in the biggest global theatrical release of all-time, “Avengers: Endgame,” which has grossed more than $2.79 billion. The Walt Disney Co. bought Marvel in 2009 for more than $4 billion, so you’ll have to pick up shares of the House of Mouse to own a piece of Marvel.

FedEx

FedEx has been synonymous with overnight shipping since its founding in 1971 as Federal Express — it transitioned to the FedEx name in 1994 — and the company revolutionized global shipping. However, things weren’t always rosy for FedEx. In the first few years of its existence, the company was struggling mightily, and at one point, company coffers were down to a mere $5,000. How did this floundering company turn its fortunes around? Founder Frederick Smith took that $5,000 in corporate cash to Las Vegas and turned it into $27,000. This allowed the company to stay afloat until it received an infusion of operating capital from outside investors. The rest, as they say, is history.

Why FedEx Is Worth Investing In

  • Stock Price: $145.55

Today, FedEx is one of the barometers of the global economy as a whole. When FedEx shipments are up, typically the economy is doing well. The company has provided an outstanding return over time for long-term investors, and it currently sits well below the all-time high of $274.32 it reached in January 2018, leaving the potential for further gains.

Chipotle

Chipotle is back to being a market darling again, but as recently as early 2016, it seemed like the company might be on its way out of business. Outbreaks of E. coli began in late 2015 and sent 60 people to the hospital across the country, according to the Centers for Disease Control and Prevention. Nothing is worse for a restaurant company than a reputation for poor health practices, and customers began to stay away from Chipotle in droves. The stock cratered from slightly more than $750 per share in August 2015 to about $250 in February 2018.

Why Chipotle Is Worth Investing In

  • Stock Price: $841.32

Chipotle might have been trading like it was going out of business, but after the final selloff in late 2018, the stock reversed course and has put in a powerful rally that saw it reach all-time highs in August 2019. Once the health scare was over, Chipotle made some modifications to its menu and got a huge boost of support from noted investor Bill Ackman in 2016. Toss in a new management team, and the company is back to reporting solid earnings and revenue growth.

Starbucks

Starbucks long has been both a Wall Street and a Main Street darling, with its addictive cups of java resulting in ever-higher growth. The company got a bit over-ambitious in the mid- to late-2000s, however, building out stores until there seemingly was one on every corner. In a growing economy, that strategy might be successful, but when the economy began slowing in 2007, Starbucks found itself overextended. The stock cratered by 42% that year, and ex-CEO Howard Schultz wrote a memo to then-CEO Jim Donald about the demise of the company.

Why Starbucks Is Worth Investing In

  • Stock Price: $88.42

Starbucks is another company (see Apple) where it took the return of a prominent, popular and successful CEO to right the ship. On the day in January 2008 that former CEO Howard Schultz returned to make everything right again with his once-thriving brand, the company’s stock jumped by 8%. Schultz closed all stores for retraining and was open to any conceivable suggestion as to how to make the company relevant again. After closing underperforming stores and rejiggering its marketing campaign, the company was back on its path to success. The recovering economy after the crash no doubt helped to lift the company as well.

Delta Air Lines

Delta is a fixture in American and global skies, tracing its roots back to 1925. However, by the mid-2000s the carrier was struggling to generate positive earnings. In 2005, Delta filed for Chapter 11 bankruptcy. At least it wasn’t alone. At the time, four major U.S. airlines were in bankruptcy protection: Delta, United, Northwest and US Airways.

Why Delta Is Worth Investing In

  • Stock Price: $57.61

In Delta’s case, Chapter 11 bankruptcy did what it was intended to do. Known as reorganization bankruptcy, as opposed to a liquidation, the process allowed Delta to “reorganize,” focus on profitable routes and implement cost reductions, including a renegotiated contract with its workers. As a result, Delta continues to fly while other airlines ceased operations.

 

Sbarro

As a mall-based pizza chain, Sbarro has had a few strikes against it as consumer preferences change. Mall-based stores have entered bankruptcy by the dozens, and Sbarro has not been immune. In fact, the company was forced to file for bankruptcy twice in a few years — in 2011 and then again in 2014. A reduction in mall-based traffic, shifting consumer preferences and overall competition in the industry wreaked havoc on Sbarro.

Why Sbarro Is Worth Investing In

  • Stock Price: N/A (private company)

In spite of all these difficulties, Sbarro remains alive and well. The company has expanded into the Russian market and has reinvented itself with a streamlined menu, a focus on quality and a refreshed store design. Sbarro is not a public company, so you’ll have to be a private investor to seek it out. The company still faces headwinds, but after surviving two separate bankruptcy claims, the company has proved it is nothing if not resilient.

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Stock prices are accurate as of the close of trading on Sept. 30, 2019.

This article originally appeared on GOBankingRates.com: 13 Great Companies To Invest In That Almost Lost It All