Key terms for net-net investing.
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A practical earnings-quality ratio for separating cash-backed profits from accrual-heavy earnings.
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A practical guide to why reported profit can diverge from actual cash generation.
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A practical guide to how companies can distort earnings and how investors can spot the warning signs.
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A practical comparison that shows why EBITDA is not the same thing as real cash earnings.
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A high-level reference point for the main ratio categories used in stock analysis.
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A cash-based way to move from accounting profit toward true earning power.
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A core profitability ratio that compares net income with total assets.
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A profitability ratio that shows how efficiently shareholder capital is being used.
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A simple overview of asset-based, earnings-based, cash-flow, and multiple-based valuation approaches.
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A simple overview of the measures investors use to compare market price with business value.
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ATMs let issuers sell small share blocks over time; watch filings to spot creeping dilution.
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High fees can force covering and fuel squeezes; low fees mean shorts can sit longer.
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Examples: buybacks, tenders, asset sales, liquidations, relistings, or credible turnarounds.
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Float excludes insider and locked-up holdings; small float can amplify short-interest and volume signals.
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Lacks a minimum conversion price, so conversions can balloon the share count when prices drop.
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Signals liquidity strain or refinancing risk and usually demands a wider margin of safety.
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A diversified net-net basket reduces single-name risk in deep-value microcaps.
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NNWC is a harsher cousin of NCAV used when liquidation value needs a more conservative haircut.
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Reverse splits change per-share math, often around listing pressure, liquidity issues, or financing risk.
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Tender offers can shrink float, return cash, and act as catalysts if they happen below intrinsic value.
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Operate where you understand the drivers, risks, and values; pass on the rest.
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Focus on quality companies, moderate prices, and diversification with minimal trading.
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Research-intensive approach focusing on bargains, special situations, and small caps with margins of safety.
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Predicting price paths or averages rather than comparing price to intrinsic value.
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Treat market quotes as offers to accept or ignore, not commands to act.
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Graham's discipline of appraising value versus price based on financial statements and conservative assumptions.
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Graham viewed workouts as businesslike underwritings of terms, timing, and downside.
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Blends equity and debt costs into a hurdle rate for projects and valuations.
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Both are non-cash expenses, but depreciation applies to tangible assets and amortization to intangibles or deferred items.
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A steady-state cash flow figure that anchors valuation beyond the balance sheet.
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A buffer that protects against mistakes, dilution, or weaker assets than expected.
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NCAV per share is the core net-net yardstick for valuing balance-sheet bargains.
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NCAV is current assets minus total liabilities, the core net-net metric.
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NTAV strips out intangibles to show hard-asset backing after liabilities.
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Non-cash charges lower earnings without immediate cash impact; add them back when assessing cash flow but consider their economic meaning.