4 Stocks Selling for Less Than the Value of Their Assets
This past Wednesday (June 1), the Dow Jones Industrial Average (DJIA) dropped nearly 300 points in just one day, causing investors to feel a bit shaken. Tempting as it may be to load up on names that now seem like bargains, further market drops may still occur in the next few weeks and months. This is why it pays to focus on stocks that have clear downside support. And as Benjamin Graham and David Dodd once noted in their famous tome Security Analysis, the safest stocks are those that trade for less than their tangible book value.
Naturally, investors need to understand what's on the balance sheet to see whether the assets are truly appealing. For example, dry-bulk shipping stocks look awfully inexpensive by this measure, but as I recently noted in this piece, the value of the ships these companies own may be worth a lot less than the value carried on their balance sheet, leaving only one stock among the group looking truly appealing.
With this in mind, here are four stocks that trade well below tangible book value, while holding assets that are appropriately valued on the balance sheet.