Trading Below Cash
What is Trading Below Cash?
How Does Trading Below Cash Work?
Trading below cash can be illustrated by a company which holds $1m in cash reserves, has $500k in outstanding liabilities, and has a total market capitalization equal to $400k. Its cash reserves less its liabilities are equal to $500k ($1m - $500k = $500k), while the total value of its stock is only $400k.
Why Does Trading Below Cash Matter?
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