Price to Net Net Working Capital Latest

The Price to Net Net Working Capital Ratio, or P / NNWC Ratio, values a company against its “fire sale” value. It is the share priced divided by the firm’s Net Net Working Capital per Share. This figure is computed from the latest available interim accounts.

Stockopedia explains P / NNWC

Price to Net Net Working Capital compares the Price to Benjamin Graham's valuation measure, Net Net Working Capital. This is defined as Cash + Short Term Marketable Investments + Accounts Receivable * 75% + Inventory * 50% of Total Liabilities.

It tries to value a company against it’s “fire sale” value - i.e., if the company were liquidated today, what could the assets be sold for? Graham theorised that if you were able to buy a company for less than this value, you couldn’t help but make money!

This may have been true in the past but such deep value strategies have been shown to be far less effective in modern times compared to when Graham was investing. This is likely because such opportunities are more readily identified and so do not last long.

As with all of our Balance Sheet Ratios, this will be based on the latest financial statements (interim or annual) but it's always important to be aware of any post-balance sheet events that may have reduced the cash balance - an acquisition or a buyback, for example. The market may be pricing in something that has not been captured by the snapshot given in the latest financial statements.

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The 5 lowest P / NNWC Stocks in the Market

Ticker Name P / NNWC StockRank
HKG:1051 G-Resources 0.17 85
HKG:2698 Weiqiao Textile Co 0.29 98
KRX:29530 Sindoh Co 0.5 73
HKG:1085 Hengxin Technology 0.52 77
HKG:6058 China Industrial Securities International Financial 0.53 39
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