This article appeared first on The Stock Market Blueprint Blog.
Here’s a breakdown of the four best-ranked stocks on the Net-Net Working Capital (NNWC) screen.
NNWC is similar to the NCAV screen except it is more stringent. Graham knew that companies undergoing liquidation would not necessarily sell all current assets at book value.
In order to add a level of safety, he felt it beneficial to discount the accounts receivables and inventories when calculating current assets.