11 Stocks Selling Below Cash

If you are looking for very cheap stocks, you may want to look for stocks that are selling below cash per share. What this means is if you take all the cash a company has and divide it by the number of shares, you get the cash per share. There are actually over 60 stocks out there, discovered by WallStreetNewsNetwork.com, which are trading below that cash amount.

The following are a list of 11 stocks, all with market caps over $400 million, that are trading way below cash per share, therefore, with a Price to Cash per Share [PCS] ratio of way below 1. Keep in mind that many of these are foreign companies, many have high debt, and many are in struggling industries. Financials are based on several sources, but should be investigated before investing in any of these stocks.

Mitsubishi UFJ (MTU) is a financial services and banking company based in Tokyo, Japan. The stock has a price to cash per share ratio of 0.208 , with a PE ratio of 11.7 .

Gov Bank of Ireland (IRE) is an Irish banking and other financial services firm. The stock has a price to cash per share ratio of 0.218 , with a PE ratio of 0.95 and a PEG of 0.09 .

Banco Santander (STD) is a commercial and private bank based in Madrid, Spain. The stock has a price to cash per share ratio of 0.233 , with a PE ratio of 5.15 and a PEG of 0.36 .

Allied Irish Banks Plc (AIB) is an Irish based banking, investment banking, and asset management company. The stock has a price to cash per share ratio of 0.248 , with a PE ratio of 1.56 and a PEG of 0.1 .

Genworth Financial (GNW) is a provider of various types of insurance, including life insurance, long term care insurance, Medicare supplement insurance, and mortgage insurance. The stock has a price to cash per share ratio of 0.298 , with a PE ratio of 3.93 and a PEG of 0.2 .

Liberty Media Capital (LCAPA) is a provider of video programming through cable, satellite, telephone, and the Internet. The stock has a price to cash per share ratio of 0.355 , with a PE ratio of 2.41 .

Banco Bilbao (BBV) is a Bilbao, Spain based bank. The stock has a price to cash per share ratio of 0.356 , with a PE ratio of 5.17 and a PEG of 0.36 .

Yazhou Coal Mining (YZC) is a Chinese based coal mining company. The stock has a price to cash per share ratio of 0.385 , with a PE ratio of 0.41 and a PEG of 0.35 .

Sadia S.A. (SDA) is a Brazil based manufacturer and marketer of processed products, poultry, and pork. The stock has a price to cash per share ratio of 0.491, with a PE ratio of 1.08 .

Discover Financial Svcs (DFS) is an Illinois based credit card company. The stock has a price to cash per share ratio of 0.517 , with a PE ratio of 12.25 and a PEG of 1.01 .

Health Net Inc (HNT) is a provider of managed health care services and health plans. The stock has a price to cash per share ratio of 0.604 , with a PE ratio of 27.38 and a PEG of 0.38 .

You can download an Excel database spreadsheet list of over 60 stocks trading below cash per share at WallStreetNewsNetwork.com. Please note that many of the stocks on that list are very low cap and therefore very speculative.

Author does not own any of the above.

Comments

[Dividends A...:]

BBV is one of my favourite international banks. It's been clobbered during this credit bubble bursting but continues to have good capital ratios, very impressive dividend and is diversified in the Spanish/Latin global banking market.

2008 Oct 31 12:50 PM

[Mark Prouty:]

you need to look at net cash by subtracting out obligations (debt, off balance sheet, etc). If you just look at P/C a company can just issue a ton of debt to increase the denominator.

2008 Oct 31 01:04 PM

[San_Fran_Sam:]

I would think that you would also want to look at the change in cash over time. they may have a lot now, but how about 6 months from now.

2008 Oct 31 02:13 PM

[Eric Fox:]

Here's a list of stocks trading under Net Current Asset Value:

news.briefing.com/Gene...

2008 Oct 31 02:14 PM

[fatcat:]

The way finacial and insurance cos. lie , I wouldn't trust any of their ratios...

2008 Oct 31 02:15 PM

[Ishortyou:]

puty is right you have to consider the debt in the formula to obtain the true cash value.

2008 Nov 01 09:12 AM

[notsosmart:]

fat cat is on the money. you cant believe the liars. the accounting trickery,the phony ratings,the lack of ethics, the self serving boards,the overpaid ceos,the total lack of transparency must be by now common knowledge by most of the sheeples.you ignore it at your own risk(maybe not-the taxpayer may bail you out).the scammers & scoundrels are not going away.they just jump around from place to place,collecting their huge incomes,paying as little tax as possible via loopholes,& laughing all the way to their swiss banks.

2008 Nov 01 09:31 AM

[Urbane Gori...:]

I agree with fatcat as well.

Irish banks? Please! South American banks? They haven't been hit with the still unfolding commodity collapse.

The only two I see as **not too spooky** are Yangzou and Sandia. And those two only because they are **not as** connected to the outside world's ills right now. Both tend to have a moat as they service their countries internally.

However! That is not to say that they will not be tarred with the same brush as their counterparts.

And I like PDA better than SDA and still prefer BTU over YCZ anyway..

But interesting list if and when the world's economies begin to pick up...

thx jegan

2008 Nov 01 03:34 PM

[Vladimir Se...:]

If you learn ONE THING from this crisis . . . please learn this:
excel junkies can not be trusted!
And by the way, I assume there is no fraud.

They will always tell you one thing: we are not subject matter experts, we are excel experts! Apparently they really believe that 6figure salaries are justified by that skill alone.
They also know how to copy&paste.

So when they tell you how much cash YCZ has per share, or any other company, please make sure you understand where they got the data they plugged into their excel "models".
when they tell you "from finance.yahoo.com" then HANG UP and stop wasting your time on them.
You know how much crap data is "out there on the internet"? a lot.
it is very difficult to get error free data. everybody is guilty. I once wrote to a person who worked at Forbes and asked him why he wrote that a certain fund paid a dividend of X% in his article. You know what he said? He said "because I got that from finance.yahoo.com. When i explained to him how wrong that data was he asked me if I WANTED him to post a correction.
I of course just wanted to know if I could trust data i got from Forbes articles. Now i knew that I couldn't. Forbes of course isn't alone. So when Moody's tells you that a certain pile of paper is AAA you MUST ask where the inputs came from. You'll be surprised! Or (I hope) maybe not so much.

So, whoever actually ANALYZED (by that i don't mean running bogus screener on bogus data) Yazhou Coal Mining, would you PLEASE come out and tell us where the data came from?
If you are silent I'm going to assume that it came from finance.yahoo.com and that you are also extremely proud of 1850% institutional ownership :))))

2008 Nov 01 07:56 PM

[PeakOiler:]

'Cash' in this reference is net cash (debt removed). Check a few stocks, eg. DFS, HNT.

2008 Nov 01 08:08 PM

[Konst:]

additionaly, Discover is getting some more cash from the visa and mastercard settlement, the amount will be determined by whether and how much they will or won't have to pay Morgan Stanley, their former parent company. Discover will also hopefully broaden its international reach by utlizing its Diners Club purchase to that end. The world is probably not coming to an end, in the long term. And having "credit exposure" is when thigs pick up a plus, because it provides a stream of revenue and profits. The market participants have been acting irrationally, though it's to be expected with what the has been happening and the government's seemingly arbitrary actions such as confiscating shareholders' equity (washington mutual, fnm, fre, aig...)

2008 Nov 02 01:27 AM

[The-Honest-...:]

Sadia had huge losses on dollar derivatives, about 300 million dollars!

It has unwinded the position already but it was an unauthorized position that's why the stock got sold off and its credit rating was reduced.

Do your homework before posting and buying...

2008 Nov 02 08:03 AM

[Richard Col...:]

The article and the comments are very informative. I want to especially thank Vladimir Senkov as he brought out some points I didn't know about.
Dan Kowkabany

2008 Nov 02 10:25 AM

[cynic69:]

Many of these companies are going to be losing money because of the high cost of energy

2008 Nov 02 01:20 PM

[cynic69:]

Many of thses companies are going to lose money because of the high cost of energy

2008 Nov 02 01:24 PM

[jrs87sch:]

Don't forget about DIVIDENDS! Stocks with good, high-paying dividends are where to be right now.

After doing hours of research I found the 5 Best Dividend Stocks and posted it on my website.

Although I completely agree with you that this market is cheap, people are afraid that they won't get any return on their money. With dividends, the money is certain to come.

2008 Nov 03 12:04 AM

[Pipo:]

Nice article. YZC has the plus of being a chinese company.

Jim Rogers has been buying China again and probably so should we.

jimrogers-investments..../

2008 Nov 03 07:27 AM

[linenoise:]

Dividends? Like what WB used to pay?

2008 Nov 03 01:52 PM

[DaveinHacke...:]

USEG, a stock I've mentioned on my site a few times, is selling for less than net cash at today's closing price. Yahoo! Finance shows $70.31 million in cash, and $14.15 million in debt for USEG, with a market cap of $53 million.

2008 Nov 03 04:21 PM

[Alex Sebastian:]

I was going to say I wouldn't touch any of these except the Brazilian meat manufacturer, but after reading the comments, I don't think I would touch any of them. Mitsubishi UFJ is planning an enormous stock offering, one which will dilute the h*** out of the current shareholders. All these financials are still facing enormous challenges, I wouldn't touch them for a few quarters at least.

2008 Nov 03 09:18 PM

[1worldcurrency:]

Well people may sit back and let banks pay dividends using taxpayer money, or they may get really angry.

2008 Nov 04 05:53 AM

[Umm, yeah:]

Good to read all of the comments here. Good work, folks!

2008 Nov 04 01:02 PM

[lanaslinesd...:]

Looking at that list, there are less than five companies I would put my money in, if I was a gambling person. There are just too many companies with questionable accounting practices out there. In this market, one can't be too sure who is telling the truth... especially if they're from China!

lanaslines.com

2008 Nov 04 05:20 PM

[phat cat:]

I ran an equity search with the following criterias: US stocks with over 100mm mkt cap, debt/equity ratio less than 20% and cash/mkt cap ratio>1. This list could be a good starting point to further narrow down the names. However, none of the names mentioned in the article showed up:

TRID, ATV, ACTS, HTH, ORBK, GRO, ZAP, KONG, ANAD, SYMX, GILT, ULCM, COWN, MEDQ, ADLR

I have to say I don't know or heard of most of these companies. I hope this is helpful.

2008 Nov 04 10:59 PM

[jose oriol ...:]

mmh... according to a polemic post value of
STD and BBV is going towards ZERO...
(in spanish only)

2008 Nov 05 06:18 AM

[maz:]

Give me a break!

Financial institutions don't "own" all the cash on the balance sheet

Looks like someone ran a screen and did no research at all

Not sure how this got approved to run on seekingalpha

2008 Nov 05 11:27 AM

[ProHFAnalyst:]

Well I took a look at GNW because I was in disbelief about your numbers. Turns out I was right. They have $5.861B of cash on the balance sheet. However they also have $8.1B of debt, so net they have debt of $2.3B.

Then I realized that you were probably talking about cash as opposed to net cash. No one cares about cash. Net cash is what matters. The reasoning is that if the company were to stop operating tomorrow and liquidate, your equity value would be protected if the shares trade below net cash*. That is not the case in the stocks you mention.

2008 Nov 05 01:08 PM

[mkreisel:]

This article is hilarious. Looking at cash without at debt is meaningless.

The author clearly has no idea about investing.

If you want simple business with ample cash, look at big techs.

2008 Nov 05 10:35 PM

[phat cat:]

It makes sense to look at companies that are trading below net cash level. Many stocks are trading at mis-priced level--yes it does happen, and if you still believe in efficient market, you'd lost your shirt already. But I agree that the list prepared by the author is misleading. I'd be happy to hear comments on the list of companies I selected above. These maybe good starting points to pick the next winner.

2008 Nov 06 04:30 AM

[emthree:]

YZC's cash per share figure at Yahoo Finance has not been adjusted for the 5 for 1 stock split.
The correct cash per share is; usd 16.095 divide by 5 = usd 3.22/ ADR share.

So, the price to cash ratio is 1.45 at today's ADR price of usd 4.66
instead of the 0.385 ratio shown in this article.

There could be similar inaccuracies in the other examples mentioned as the author seems to have taken raw figures from a source like Yahoo Finance without checking the details.

2008 Nov 06 07:31 PM

[Spacegold:]

Thanks, Phat, for showing eveeryone how the list should have been run. I lost a little respect for seekingalpha after reading this article.


On Nov 04 10:59 PM phat cat wrote:

> I ran an equity search with the following criterias: US stocks with
> over 100mm mkt cap, debt/equity ratio less than 20% and cash/mkt
> cap ratio>1. This list could be a good starting point to further
> narrow down the names. However, none of the names mentioned in the
> article showed up:
>
> TRID, ATV, ACTS, HTH, ORBK, GRO, ZAP, KONG, ANAD, SYMX, GILT, ULCM,
> COWN, MEDQ, ADLR
>
> I have to say I don't know or heard of most of these companies. I
> hope this is helpful.

2008 Nov 06 11:26 PM

[mktcycler:]

Take a look at Celestica CLS and Benchmark Electronics BHE for well-run companies (albeit in a commoditized industry) that have a market cap below their current net working capital (working capital less all LT debt --sorry, not just cash).

If you know of a true net cash stock that is not a fly-by-night company, please reply back.

2008 Nov 07 09:52 AM

[suburban blues:]

cash per share...thoughts on QXM ?

2008 Nov 07 10:27 AM

[Stock Markets:]

Yes, yes, yes, but what about their debts? I will be very cautious and will do lots of research before even considering these stocks.

2008 Nov 08 01:39 AM

[adcva:]

Too bad about the call on Genworth (GNW). Trading at about $4.50 when this article was written, now at $2.67 after posting a dismal quarter. Ouch. Shareholders would get a better return if they liquidated.

2008 Nov 08 08:36 AM

[searcher:]

Cash is important as it is currently available, by definition. Debt may or may not be currently subject to payment demand. Most likely it is due at varying amounts and 'maturities', be it due to banks or bondholders. Cash on hand buys time and strategic options not available to those without same. Is cash determinative regardless of nearby maturities or market position or susceptibility to changes in costs of production or distribution, of course not.

2008 Nov 08 12:13 PM

[Kofi Bofah:]

I would recommend analyzing the statement of cash flows before evaluating 'cash.' Is the cash increase a product of operations? Or is the cash on the books available due to basic asset sales?

2008 Nov 09 02:26 AM

[John Manley:]

Who knows the best sites for dividend assessments? I'm looking at BAC with a current dividend yield of over 5.6 pct and I want to know how secure that div is.

2008 Nov 09 11:44 PM

[John Manley:]

And I agree with earlier comments about trusting information from any insurer or other complex financial company. Too much toxic debt out there for me.

2008 Nov 09 11:46 PM

[User 265729:]

The way Paulson and Pelosi are printing money these days, everything is selling below cash!

Paulson doesn't even want to tell you what they did with $2 TRILLION DOLLARS! That's right $2 TRILLION DOLLARS!

It's not in my mattress. Is it in your mattress Pelosi?

Story from Bloomberg:

www.bloomberg.com/apps...

What an outrage!

ALL STOCKS AND COMPANIES ARE SUSPECT UNTIL PROVEN OTHERWISE. All of these financially sound companies are not so sound after all. Paulson and buddies are covering-up for these crooks and failures by FAILING TO DISCLOSE WHO THE TREASURY LOANED $2 TRILLION TAXPAYER DOLLARS!

Anybody who would invest one PENNY in this market is an absolute FOOL!

Our government... What a pathetic bunch. This is gonna be a lot worse than the Great Depression when this sucker goes down.

2008 Nov 10 10:15 PM

[Stealthmouse:]

Though some of these could be gems in the rough, there are usually good reasons for a company selling below net cash. And they're usually not positive. It's usually a sign that the company is dead, it's burn rate is very high, or both. This same argument was used for some of the internut companies a few years ago, as they burned through the remaining cash in a matter of months. No knowledge of these ones, but buyer beware if it's your only screen.

2008 Nov 10 10:20 PM

[Mark Prouty:]

I looked at GNW (on the list) if you truly dig through the financials most likely the bonds may not be saved, there is a ton of leeway in calculating reserves with sill assumptions like 7% returns and mean reverting interest rates. The accounting looks better than the economics because DAC can be placed on the balance sheet and is very intangible especially given problems with hedging programs. The most likely scenario is assets (not marked at book in a HTM account) but rather taking their schedule D and obtaining true market quotes they are insolvent and could not even cover their liabilities to policy holders.

We should remember AIG was not looking for 150B in capital raise, once people accounted for them correctly the truth came out. Do you think all these level 3 assets in financials have conservative marks. If you can read the 10k and understand 70% maybe you should invest in these names. I consider my financial modelling skills above average but would need a year to model all of AIG.

On a side note, not sure the fascination with dividends and Cramer pushing this. A dividend is a return of capital, not a return on capital. The shares go down by the dividend amount (less tax arb) on ex-dividend date. It is only good if management sucks and you don't want them reinvesting earnings. Their are some favorable tax arb plays you can do especially if divs get taxed as ordinary income.

2008 Nov 12 08:43 PM

[Francis Sch...:]

We think it is particularly dangerous to advise Banks and Financials. There is no indication yet as to how the Credit Crunch and the derivatives will affect the balance sheets. More important, we have no idea how dangerous the off-balance items can be.

2008 Nov 13 01:48 PM

[The_Value_I...:]

There is no short cut. As noted above, this is a good place to start. You need to make adjustments for receivables, inventory, debt, off b-s agreements et al. and a note about excel junkies. I agree, don't trust quants but I feel it's more programmers and mathematical "geniuses" that you don't want to trust. An excel junkie can build a great model and still use human judgment. Remember that no matter how great or dynamic your model is, and how many macros you write to make it "think" it cant be as qualitative as a human. Investors with sound track records analyzing the fundamentals of firms and assets will prevail as they always have. Where is Ben Graham when we need him?

2008 Nov 13 05:32 PM

[sr9web:]

BBV...? That bank is in Argentina. Why would I go there for 8% yield when I can buy NRF common and preferreds here?

2008 Nov 14 05:13 PM

[FWallace:]

Why not invest in the exchange-traded-funds: SPY or DIA leaps/2010 ???

2008 Nov 15 06:11 PM

[jduewel2:]

Take a good look at the Canadien Oil & Gas Trusts like HTE and PVX. I can't find anyone that can beat those returns.


On Oct 31 12:50 PM Dividends Anonymous wrote:

> BBV is one of my favourite international banks. It's been clobbered
> during this credit bubble bursting but continues to have good capital
> ratios, very impressive dividend and is diversified in the Spanish/Latin
> global banking market.

2008 Nov 16 08:45 AM