Conseco Insurance (CNO) Message Board

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Non-Tech : Conseco Insurance (CNO)

CNO 40.49

+0.4%

Nov 6 3:59 PM EST

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To: AK2004 who wrote (3434)	10/6/2000 5:50:12 PM
From: F. Lynn	Read Replies (1) of 4155

Shareholder's equity DOES NOT equal (price) * (# of shares). (Price) * (# of shares) = market capitalization. Shareholders equity = (Equity) / (# of shares). The equity number is on the balance sheet, and has nothing to do with share price. Kevin is referring to TANGIBLE EQUITY Per Share, which is equal to: ((Equity)-(Goodwill))/ (# of shares) This number is important for distressed companies because it serves as a proxy for share value IF THE COMPANY IS LIQUIDATED. it's just common sense:if the company is liquidated the shareholders will receive the proceeds from the sale of assets LESS the payment of debt. if tangible value per share is $3, and it is, and the market price is $6 something, and it is, it suggests that in the event of a liquidation or reorganization shareholders will be very disappointed in their returns. time to review your financial statement analysis.

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