Not All Net/Nets Are Buyable

On Monday, I wrote about some of the recent "graduates" from net/net land. Today I'll focus on some of the companies that are currently trading below their net current asset value (NCAV).

By way of a refresher, and for new readers, the calculation for identifying net/nets is fairly simple: Subtract total liabilities (including minority interests and preferred equity if applicable) from current assets, and then compare that with the company's current market cap. If the market cap is below the number you have calculated, you've found a net/net. Ben Graham, who developed the technique, took it a few steps further and was a bit more stringent about those he considered investable, but we'll save that discussion for another day....358 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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