11 Stocks Selling Below Cash

by: Stockerblog October 31, 2008 | about stocks: AIB / BBV / DFS / GNW / HNT / IRE / LCAPA / MTU / SDA / STD / YZC    

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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.

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This article has 47 comments:

  •  
    Oct 31 12:50 PM
    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.
    Reply | Link to Comment
  •  
    Oct 31 01:04 PM
    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.
    Reply | Link to Comment
  •  
    Oct 31 02:13 PM
    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.
    Reply | Link to Comment
  •  
    Oct 31 02:14 PM
    Here's a list of stocks trading under Net Current Asset Value:

    news.briefing.com/Gene...
    Reply | Link to Comment
  •  
    Oct 31 02:15 PM
    The way finacial and insurance cos. lie , I wouldn't trust any of their ratios...
    Reply | Link to Comment
  •  
    Nov 01 09:12 AM
    puty is right you have to consider the debt in the formula to obtain the true cash value.
    Reply | Link to Comment
  •  
    Nov 01 09:31 AM
    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.
    Reply | Link to Comment
  •  
    Nov 01 03:34 PM
    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
    Reply | Link to Comment
  •  
    Nov 01 07:56 PM
    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 :))))
    Reply | Link to Comment
  •  
    Nov 01 08:08 PM
    'Cash' in this reference is net cash (debt removed). Check a few stocks, eg. DFS, HNT.
    Reply | Link to Comment
  •  
    Nov 02 01:27 AM
    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...)
    Reply | Link to Comment
  •  
    Nov 02 08:03 AM
    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...
    Reply | Link to Comment
  •  
    Nov 02 10:25 AM
    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
    Reply | Link to Comment
  •  
    Nov 02 01:20 PM
    Many of these companies are going to be losing money because of the high cost of energy
    Reply | Link to Comment
  •  
    Nov 02 01:24 PM
    Many of thses companies are going to lose money because of the high cost of energy
    Reply | Link to Comment
  •  
    Nov 03 12:04 AM
    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.
    Reply | Link to Comment
  •  
    Nov 03 07:27 AM
    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..../
    Reply | Link to Comment
  •  
    Nov 03 01:52 PM
    Dividends? Like what WB used to pay?
    Reply | Link to Comment
  •  
    Nov 03 04:21 PM
    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.
    Reply | Link to Comment
  •  
    Nov 03 09:18 PM
    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.
    Reply | Link to Comment
  •  
    Nov 04 05:53 AM
    Well people may sit back and let banks pay dividends using taxpayer money, or they may get really angry.
    Reply | Link to Comment
  •  
    Nov 04 01:02 PM
    Good to read all of the comments here. Good work, folks!
    Reply | Link to Comment
  •  
    Nov 04 05:20 PM
    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
    Reply | Link to Comment
  •  
    Nov 04 10:59 PM
    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.
    Reply | Link to Comment
  •  
    Nov 05 06:18 AM
    mmh... according to a polemic post value of
    STD and BBV is going towards ZERO...
    (in spanish only)
    Reply | Link to Comment
  •  
    Nov 05 11:27 AM
    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
    Reply | Link to Comment
  •  
    Nov 05 01:08 PM
    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.
    Reply | Link to Comment
  •  
    Nov 05 10:35 PM
    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.
    Reply | Link to Comment
  •  
    Nov 06 04:30 AM
    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.
    Reply | Link to Comment
  •  
    Nov 06 07:31 PM
    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.
    Reply | Link to Comment
  •  
    Nov 06 11:26 PM
    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.
    Reply | Link to Comment
  •  
    Nov 07 09:52 AM
    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.
    Reply | Link to Comment
  •  
    Nov 07 10:27 AM
    cash per share...thoughts on QXM ?
    Reply | Link to Comment
  •  
    Nov 08 01:39 AM