Buy this company for negative $12 million
I tweeted out a question about a super small obscure company today as an intellectual exercise for anyone who follows these random assets.
Can you take a guess which stock this is (don’t look below).
I have written up this company on May 18th, 2022. The market cap was $56 million and enterprise value of only $2.8 million. Today the market cap is $41 million with an enterprise value of negative $12 million. Effectively, anyone buying the equity today is getting $12 million dollars in free money!
It’s pretty tough to find companies trading at a negative enterprise value. Most of the time companies trading with a negative enterprise value are biotech companies with no business model losing $150 million per year. This company on the other hand generated $18 million in EBITDA in 2021 and is growing their topline at a 10-15% annualized rate.
So what is the problem here? You have a growing company. A ton of cash. Free cash flow is positive every quarter. There is even $15 million of land and buildings on the balance sheet that are likely over depreciated. The problem is that this company is going dark and deregistering from the SEC.
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