Jump to content

Net-Net Definition: Babcock & Wilcox (BWC)


kirkomi
 Share

Recommended Posts

Hello All,

 

I am a part time investor, so pardon me for asking something which you might find stupid.

 

I follows Geoff's blog and I came across the post today on BWC.

 

http://gannonandhoangoninvesting.com/blog/2015/1/21/sold-town-sports-club-bought-babcock-wilcox-bwc

 

Now, Geoff claims that BWC is a net-net. I fail to see that. Here is their most recent balance sheet (Nov 5, 2014).

 

Current Assets: $1.37B

Total Assets: $2.6B

Current Liabilities: $711M

LT Debt: $298M

Total liability: $1.47B

 

Market Cap: $2.8B

 

The questions is: how is this a net-net ? I have read some of Geoff's analysis, so please take him seriously.

 

 

Link to comment
Share on other sites

Where does he say it is a net-net?  Not being a subscriber to his paid newsletter, there is nothing of substance at the link you provided.  Not too long ago it could be said that the company had "net cash" or a "net cash position."  But a net-net is much more rare, especially in large US companies.

Link to comment
Share on other sites

It's probably just a misunderstanding. Geoff wrote:

 

The four non-Japanese net-nets in my portfolio right now are:

 

1. George Risk

2. Ark Restaurants

3. Weight Watchers

4. Babcock & Wilcox

 

I think what he was trying to say was that his portfolio consists of some Japanese net-nets and these four companies. I was confused myself when I read his post.

Link to comment
Share on other sites

It's probably just a misunderstanding. Geoff wrote:

 

The four non-Japanese net-nets in my portfolio right now are:

 

1. George Risk

2. Ark Restaurants

3. Weight Watchers

4. Babcock & Wilcox

 

I think what he was trying to say was that his portfolio consists of some Japanese net-nets and these four companies. I was confused myself when I read his post.

 

That's correct, as WTW most certainly is not a net net...

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...