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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Bob Rudd who wrote (7395)	6/5/1999 11:46:00 PM
From: James Clarke	Read Replies (2) \| Respond to of 78644

Why you don't apply Graham net current assets to banks. Because a bank has leverage of 90-95%. (5-10% equity to assets) If those assets are just a little bit off, you're dead. Contrast that with Hyde at 4, with net current assets of 7. If the net current assets turn out to be worth 20% less, so what? You still have a steal. Bank accounting structure does not lend itself to becoming a net-net anyway because there are long term liabilities - that's just the nature of the business. I don't think I've ever seen a bank on a net-net screen. And if I did, I would be extremely careful.