Get Premium to unlock powerful stock data

3 Stocks With Solid Balance Sheets for the Value Investor

These stocks match key criteria of Benjamin Graham

Author's Avatar
Alberto Abaterusso
Jun 03, 2021
Article's Main Image

Benjamin Graham, the father of value investing, suggested screening the market for stocks that have a current ratio of more than 2 plus more working capital than long-term debt.

When the current ratio is higher than 2, the company has managed to produce more than enough liquidity to refund its short-term creditors. The ratio is calculated as total current assets divided by total current liabilities.

When the working capital exceeds the long-term debt substantially, it means that the business will likely be able to continue honoring its long-term debt obligations. The working capital is the difference between total current assets and total current liabilities.

Thus, investors could be interested in the following stocks, as they hold the above criteria.

Bio-Techne Corp

The first stock that holds the criteria is Bio-Techne Corp (

TECH, Financial), a Minneapolis, Minnesota-based biotechnology manufacturer of life science reagents and instruments, as well as a provider of services for the research and clinical diagnostic markets worldwide.

The stock has a current ratio of 4.12 versus the industry median of 5.78.

Bio-Techne Corp has a trailing 12-month working capital of about $414.25 million and long-term debt of $344.24 million as of the most recent fiscal year.

1400366402199638016.png

GuruFocus assigned a rating of 7 out of 10 for the company's financial strength.

The share price was trading at $410.13 at close on Wednesday for a market capitalization of $15.95 billion and a 52-week range of $228.66 to $444.83.

1400366464824791040.png

Wall Street sell-side analysts recommend a median rating of overweight and an average target price of about $453.89 per share for the stock.

Zai Lab Ltd

The second stock that holds the criteria is Zai Lab Ltd (

ZLAB, Financial), a Shanghai, China-based biopharmaceutical developer of treatments for several therapeutic branches including oncology, autoimmune diseases and infectious diseases in China.

The stock has a current ratio of 11.32, which is more appealing than the industry median of 5.78.

Zai Lab Ltd has a trailing 12-month working capital of about $1.118 billion and no long-term debt as of the most recent fiscal year.

1400366683754876928.png

GuruFocus assigned a rating of 6 out of 10 for the company's financial strength.

The stock was trading at $176.79 at close on Wednesday for a market capitalization of $16.67 billion and a 52-week range of $67.51 to $193.54.

1400366740117934080.png

Wall Street sell-side analysts recommend a median rating of buy and an average target price of $206.16 per share for the stock.

Cree Inc

The third stock that holds the criteria is Cree Inc (

CREE, Financial), a Durham, North Carolina-based provider of light emitting diodes and semiconductors for power and radio-frequency applications in the United States and internationally.

The stock has a current ratio of 4.18, which is more appealing than the industry median of 2.32.

Cree Inc has trailing 12-month working capital of $1.302 billion and long-term debt of $783.80 million as of the most recent fiscal year.

1400366913934086144.png

GuruFocus assigned a rating of 5 out of 10 for the company's financial strength.

The stock was trading at $99.73 on Wednesday for a market capitalization of $11.52 billion and a 52-week range of $52.31 to $129.90.

1400366981688872960.png

Wall Street sell-side analysts recommend a median rating of hold and an average target price of $115 per share for the stock.

Disclosure: I have no positions in any securities mentioned.

Not a Premium Member of GuruFocus? Sign up for a free 7-day trial here.
Rating:
0 / 5 (0 votes)

Please Login to leave a comment