All of these companies have very substantial amounts of cash or cash equivalents on their balance sheets. Some of these companies are even trading below their cash values, giving them a negative enterprise value. Enterprise value is basically the total market capitalization plus debt, less cash.
Some of these companies are losing money, or have other problems and that can be why the market seems to be ignoring them. But, due to their extremely high cash balances, some of them might be lower risk investments or potential turnaround stocks. They might even be interesting takeover targets since an acquiring company can buy cash rich companies more easily than debt laden companies. Here are the companies:
Actions Semiconductor Co., (NASDAQ:ACTS) shares are trading for $2.09. Actions is a semiconductor company, based in China. The 52 week range for these shares is $1.83 to $2.60. The book value is stated at $3.77. What's remarkable is that the market cap of this company is less than the value of cash and marketable securities on the balance sheet. Actions has a market capitalization of approximately $178 million.
The company states it ended the year 2010 with $42.9 million in cash and cash equivalents together with time deposits as well as trading securities and marketable securities, current and non-current, of $189.7 million at the end of the year. For full earnings and other details read this. These shares appear to be stuck in a trading range, so trading these shares might be the best strategy for now.
Heelys, Inc., (NASDAQ:HLYS) shares are trading for $2.25. Heelys makes wheeled shoes that are popular with kids and young adults. Heelys is based in Texas. The 52 week range for these shares is $1.90 to $3.63. The book value is $2.82. This company has been posting losses: Heelys reported a net loss of $3.2 million, or 12 cents per share, for the quarter ended December 31, 2010, and a net loss of $4.0 million, or 14 cents per share, for the year ended December 31, 2010.
Heelys has a market capitalization of approximately $63.4 million. If Heelys can turn a profit, these shares shares have lots of upside. This company has been considered a takeover target in the past, and if that happens the shares could pop up, however, right now it seems best to trade these shares for short term spikes.
Arctic Cat, Inc., (NASDAQ:ACAT) shares are trading for $14.01. Arctic Cat makes snowmobiles and all terrain vehicles. This company is based in Minnesota. The 52 week range for these shares is $6.92 to $17.97. The book value is $10.46. Arctic Cat has been reporting profits and the company expects 2011 earnings of $0.57-0.65 a share. Read about their latest quarterly report here. Arctic Cat has a market capitalization of approximately $280 million and cash or cash equivalents of about $107 million. This large cash balance could make ACAT an attractive buyout target.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.