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Benjamin Graham Net Nets Screen 41 Qualifying in UK


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This strategy is one of Ben Graham's most famous bargain stock strategies aiming to find stocks trading for less than their liquidation value.  The idea is to find stocks  trading at such a cheap price that you could buy the whole company and sell off all the assets at a profit with near minimal risk.    It is a simplistic screen which just looks for stocks where the market cap is less than the so called 'Net Net Working Capital'  (defined as  Cash and short-term investments + (75% of accounts receivable) + (50% of inventory) - All Liabilities).  The formula is very conservative in estimating the value of inventory and receivables due to the likelihood that not all will be collectible in a firesale. About such stocks Graham wrote: ‘ No proprietor or majority holder would think of selling what he owned at so ridiculously low a figure…In various ways practically all these bargain issues turned out to be profitable and the average annual result proved much more remunerative than most other investments’. This is not a strategy for the faint-hearted due to the high risk companies that qualify. Graham sought safety from individual bankruptcy risk by diversifying his portfolio with a large numbers of companies – he suggested 30. To learn more about this strategy please click here »

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About Benjamin Graham

Known as the Father of Value Investing, wrote the Intelligent Investor


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The Intelligent Investor: The Classic Text on Value Investing

by Benjamin Graham

Presents the philosophy of 'value investing', which helps protect investors against the areas of possible substantial error and teaches them to develop long-term strategies with which they will be comfortable down the road. This book enables you to make the right decisions to protect your investments and make them a success.

This screen is based on a UK dataset. It uses the following criteria:

  • P/NNWC < 1
  • 3m Avg Vol > 0.25
  • Sector not in F inancials,

Results are sorted by:

  • P/NNWC in ascending order


And limited to the first 200 Results

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Benjamin Graham Net Nets Screen Graphical History in

Returns

Timeframe Screen Returns FTSE 100 Outperformance
1 week -1.36% 2.60% -4.0%
1 month -2.11% 8.23% -10.3%
3 months 0.21% 6.66% -6.5%
6 months 33.61% 18.37% 15.2%
1 year 25.09% 29.17% -4.1%
Since inception 40.93% 27.5% 13.4%
Annualised 26.94%

Risk

Maximum Drawdown-23.21%
Average No. of Holdings20.1
Diversification LevelGood

 Chart based on an equal weighted portfolio of max 25 stocks rebalanced quarterly. Qualifying shares below updated daily. Past performance not indicative of future returns.


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41 Qualifying in

Ticker Name Mkt Cap £m P/NNWC 3m Avg Vol Sector
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Subscriber Subscriber Industrials  
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Subscriber Subscriber Basic Materials  
Subscriber Subscriber Consumer Defensives  
Subscriber Subscriber Energy  
Subscriber Subscriber Basic Materials  
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Subscriber Subscriber Energy  
Subscriber Subscriber Industrials  
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Can't see the share you expect? View this screen as a checklist to find out why.

You should consider the results of any screening process, including this one, as candidates for further research, not as a buy list. Screening helps to narrow a search based on pre-defined criteria. It is not a substitute for independent research reflecting your individual criteria for investing/trading. Please note that the screening criteria used represents Stockopedia's interpretation of the author's investment approach and are not determined or endorsed by the original strategist.



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