dec. 27 yahoo headlines seeking alpha says FSYS much better than Amazon or Tesla below
Amazon and Tesla are much riskier than Fuel Systems Solutions. FSYS trades at just 30% above its NET CURRENT ASSET VALUE OR NCAV and 23% below its BOOK VALUE OR BV. Tesla and Amazon, however, have betas below one, implying less riskiness than the market, yet their assets are far below their stock prices. Both companies' NCAV per share is negative. Amazon's BV is only 5% of its stock price while Tesla's is only 3%. The ground is far below Amazon and Tesla and only inches below Fuel Systems.
book value is way overrated as a gauge to determining value..I remember 10 years ago, I got scared off from buying YUM, because it actually had negative book value or shareholder's equity...It went up ten fold since then
I find BV to be almost useless in determining maximum price. Companies with big, but manageable debt loads often show as low BV in comparison to share price especially at the beginning of a growth cycle. BV becomes meaningful in finding value at the bottom end of a potential price range because it should in theory provide some type of floor of support. I also prefer tangible asset value to book as it ignores intangible assets, and I think is a truer liquidation value than either of the metrics used in the article.