April Ben Graham Net-Net Pick: 80% of the Market Cap is Cash
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This month’s pick:
· The company trades at 80% of NCAV and 68% of book value.
· The company has a P/E of 5.75
· Cash rich, cash equals 80% of the company’s market capitalization.
· Looking past excess cash the company is extremely cheap with an EV/EBIT multiple of .82x.
· Profitable during the financial crisis even with a significant drop off in revenue in 2010.
· The company has shown their agility by changing their market strategy successful in response to industry challenges.
Download your copy of the Ben Graham: Net-Net Newsletter today
“It always seemed, and still seems, ridiculously simple to say that if one can acquire a diversified group of stocks at a price less than the applicable net current assets alone...the results should be quite satisfactory. They were so, in our experience, for more than 30 years.”- Ben Graham
What’s a Net-Net?
A net current asset value bargain—or net-net—is a stock selling for less than the value of its current assets—cash, receivables, and inventory—minus all liabilities. Basically, it’s a stock selling for less than its liquidation value.
What’s the Ben Graham: Net-Net Newsletter?
GuruFocus’s Ben Graham: Net-Net Newsletter is written by Nate Tobik. It picks one new net-net every month. The newsletter goes out to subscribers on the first Friday of the month. The newsletter looks for stocks that have both a tangible margin of safety and reasonable upside potential.
So, get your copy of the Ben Graham: Net-Net Newsletter today.