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Strategies & Market Trends : Value Investing
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To: rjm2 who wrote (11893)1/17/2001 7:17:32 PM
From: TimbaBear  Read Replies (1) of 79022
 
The thing to remember with Net current assets is that the inventory (as well as other things) is often worth considerably less in a liquidation. So when you buy net-nets, like I did with DIYH, and they close stores, inventory only brings in the 65% range.
I agree....in Security Analysis, Graham gives a chart that shows his discounts for various categories. In my evaluations, I count receivables at 80%, Inventory at 66%, and all long term assets at 50%.

I haven't looked at DIHY or FRDM yet.
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