April 6, 2014 Issue of Ben Graham Net-Net Bargains Newsletter Is Ready

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Benjamin Graham Net Current Asset Value Screener


What are Benjamin Graham's Net Current Asset Value Bargains?

Update: We have created a monthly Net Current Asset Bargains newsletter to highlight the baingains we find.

In The Intelligent Investor, Benjamin Graham discussed the methods he used in his investment firm Graham_Newman. One is them is what he called Net-Current-Asset (Or “Bargain”) issues. He wrote:

The idea here was to acquire as many issues as possible at a cost for each of less than their book value in terms of net-current-assets alone – i.e., giving no value to the plant account and other assets. Our purchases were made typically at two-thirds or less of such stripped-down asset value. In most years we carried a wide diversification here – at least 100 different issues.

Graham’s “net current asset value” approach, apparently works very well. One research study, covering the years 1970 through 1983 showed that portfolios picked at the beginning of each year, and held for one year, returned 29.4 percent, on average, over the 13-year period, compared to 11.5 percent for the S&P 500 Index. Other studies of Graham’s strategy produced similar results.

Ben Graham loved these types of situations, defining the net-net value as:

Cash and short-term investments + (0.75 * accounts receivable) + (0.5 * inventory) - total liabilities

Graham looked for companies whose market values were less than two-thirds of that net-net value.

With this in mind, GuruFocus has created a Graham Net Current Asset Value screener to filter out the companies that meets the net-net value criteria. The rules are:

  • The stock prices are less than the net current asset value of the companies – Benjamin Graham
  • During the past 12 months, the companies generated positive operating cashflow.
  • The company has no meaningful debt compared to its cash position.
  • According to Benjamin Graham, some of these companies may well go under as economic conditions worsen, it is important to hold a diversified group of them.

The performance of the stocks can be seen in user portfolios, described in this article



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This information is for Premium Members Only.


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Symbol Company Net Current Asset Value (NCAV) Price Price/NCAV (%) Oprt. Cash Flow per share(12m) ($) Market Cap ($mil)
Premium Member OnlyPremium Member Only47.07$32.0068-2.102884.625
Premium Member OnlyPremium Member Only20.76$28.30136.31.0014.705
Premium Member OnlyPremium Member Only20.11$16.50822.80292.971
Premium Member OnlyPremium Member Only14.48$16.30112.61.1012.642
Premium Member OnlyPremium Member Only17.72$16.13911.70148.509
Premium Member OnlyPremium Member Only10.01$10.59105.80.30148.528
Premium Member OnlyPremium Member Only12.45$10.5084.31.70152.631
Premium Member OnlyPremium Member Only8.60$10.33120.1-1.3049.357
Premium Member OnlyPremium Member Only9.71$10.27105.80.2097.749
Premium Member OnlyPremium Member Only7.67$8.85115.40.9098.130
Premium Member OnlyPremium Member Only5.85$7.75132.50.5038.992
Premium Member OnlyPremium Member Only6.15$5.9496.60.00384.551
Premium Member OnlyPremium Member Only3.52$4.96140.90.20292.099
Premium Member OnlyPremium Member Only3.96$4.90123.70.6027.800
Premium Member OnlyPremium Member Only4.38$4.80109.6-0.3019.339
Premium Member OnlyPremium Member Only7.06$4.7567.30.90314.123
Premium Member OnlyPremium Member Only3.83$4.00104.40.108.711
Premium Member OnlyPremium Member Only2.71$3.98146.90.0013.511
Premium Member OnlyPremium Member Only3.23$3.80117.6-1.9039.787
Premium Member OnlyPremium Member Only4.12$3.79920.7010.411
Premium Member OnlyPremium Member Only2.96$3.74126.4-5.2035.229
Premium Member OnlyPremium Member Only2.87$3.56124-0.1022.485
Premium Member OnlyPremium Member Only2.65$3.41128.7-0.5010.041
Premium Member OnlyPremium Member Only3.14$3.40108.3-0.406.671
Premium Member OnlyPremium Member Only2.45$3.30134.7-0.2093.079
Premium Member OnlyPremium Member Only3.79$3.2084.4-0.90395.220
Premium Member OnlyPremium Member Only2.27$3.20141-1.00280.078
Premium Member OnlyPremium Member Only3.80$3.2084.20.00103.865
Premium Member OnlyPremium Member Only3.91$3.0578-0.3023.643
Premium Member OnlyPremium Member Only3.62$2.9882.3-0.8056.152

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