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8 Cheap Stocks Below Net Net Working Capital

Inoculated Investor

Jae Jun

You can still find bargains out there. The quality may have dropped but they are still out there.

The reason why small investors can out gain the big boys is due to these small to micro cap companies. Include OTC stocks and you’ve got yourself a vast empty playing ground filled with deep value investing opportunities.

Here is a list of 8 very cheap stocks, all trading below my favorite metric, net net working capital. Had to go through about 70 stocks to find these 8 that are still cheap compared to its asset value.

TickerNNWC Per ShareCurrent PriceDiscountComments
SODI$2.4$2.28%Looks to be a good pick. Good SODI write up. Go to the value investing forum.

Assets look to be of high quality, reliable with very little debt. Ongoing basis stock valuation at around $4.50 which is a significant discount to intrinsic value.
FORD$2.64$2.0223%A value stock that has popped up quite often. Discussed underFORD topic in the forum as well.
NCTY$8.52$7.1816%Chinese company involved in multiplayer internet games. Mostly made up of cash.
INSM$0.92$0.7419%Insmed still very cheap. Refer to my latest valuation and INSM financial statement analysis.
SIG$33.73$25.4125%Missed picking up SIG when it was below $10. Should've would've could've.

Still cheap but a lot of it is made up of receivables and inventory.
HLYS$2.36$2.0513%Not sure how this fad company will get back up. Company has plenty of cash but i wonder whether a turnaround will ever be possible.
TSRI$2.57$2.358%An IT outsourcing company. Cheaper than MHH, but I like MHH much better which is why I never bought it.
AMGY$0.6$0.517%A tiny OTC company. Another Chinese company that uses American in their name. No idea why. But I've realised I don't like any that do.

In PDF format available for download.

8 Cheap Stocks Below Net Net Working Capital

Jae Jun

Old School Value.

About the author:

Jae Jun

My name is Ben C. and I am 2nd year MBA candidate at the Anderson School of Business at the University of California- Los Angeles. I have a BS in Economics from the Wharton School of Business at the University of Pennsylvania. Before coming to Anderson I worked as a generalist equity research analyst for Right Wall Capital, a long-short equity hedge fund located in New York City. Prior to working at Right Wall I worked as an analyst at Blue Ram Capital, another long-short equity hedge fund located in Rye Brook, NY. This past summer, I worked for West Coast Asset Management as a research analyst. West Coast, which was co-founded by Kinko’s founder Paul Orfalea, is run by well-known value investors Lance Helfert and Atticus Lowe.

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