Month: September 2025

Bargain Hunters’ Delight: Four Stocks Trading Below Cash Per Share with Minimal Debt

by Fred Fuld III

In the volatile world of stock investing, few opportunities scream “value” louder than companies trading below their cash per share. This phenomenon occurs when a stock’s market price is lower than the amount of cash and cash equivalents divided by the number of outstanding shares—essentially meaning investors can buy a dollar’s worth of cash for less than a buck. When paired with little to no debt, these stocks offer a rare combination of safety and upside potential.

Why Buy Stocks Below Cash Per Share?

The allure is straightforward and compelling. First, downside protection is baked in: In the worst-case scenario, the company could liquidate its cash holdings, pay off any nominal debt, and return value to shareholders exceeding the current purchase price. This acts as a financial floor, shielding investors from total loss. Second, it often implies the underlying business is “free”—you’re paying for the cash pile but getting the operations, intellectual property, and growth prospects thrown in at no extra cost. Third, low-debt profiles minimize bankruptcy risk and interest burdens, allowing management flexibility to pivot, invest in R&D, or pursue acquisitions without the drag of leverage. Historically, such setups have attracted value investors like Warren Buffett, who famously sought “cigar butt” stocks—cheap, undervalued assets with one last puff of potential.

As of late September 2025, amid market rotations and sector-specific pressures, four notable names fit this profile: Alumis (ALMS), Arvinas (ARVN), Green Dot (GDOT), and Keros Therapeutics (KROS). These span biotech innovation and fintech stability, all with enterprise values dipping negative due to cash hoards outpacing market caps. Let’s dive in.

Alumis Inc. (ALMS): Precision Immunology on the Cheap

Alumis Inc. is a clinical-stage biopharmaceutical company laser-focused on immune-mediated diseases, leveraging a precision medicine platform to develop oral small-molecule therapies. Founded on cutting-edge genomics and AI-driven drug design, the company aims to transform treatments for conditions like psoriasis and atopic dermatitis, where current options fall short in efficacy or convenience.

Financially, Alumis is a textbook cash-rich bargain. As of June 30, 2025, it held $486.32 million in cash against just $38.78 million in debt—barely 8% of its liquid assets. With 96.88 million shares outstanding, that’s $5.02 in cash per share, dwarfing the September 26 closing price of $4.05 and a market cap of $421.46 million. Enterprise value? A negative -$26.08 million, signaling the market is essentially ignoring the biotech’s pipeline while over-discounting risks in early trials.

For investors, this setup offers fortress-like protection: Even if development hits snags, the cash runway extends years, funding Phase 2 readouts without dilution. Upside? Successful precision therapies could multiply value in a $100 billion immunology market.

Arvinas Inc. (ARVN): Degrading Disease Proteins for Pennies

Arvinas stands at the forefront of targeted protein degradation, pioneering PROTAC (proteolysis targeting chimeras) technology to tag and destroy disease-causing proteins inside cells—a leap beyond traditional inhibitors. The New Haven-based biotech targets oncology and neuroscience, with lead candidates like vepdegestrant in Phase 3 for breast cancer and ARV-102 advancing for neurodegenerative disorders.

On the balance sheet, Arvinas is awash in liquidity. Q2 2025 cash stood at $861.2 million, offset by a negligible $9.9 million in debt. Divided by 73.42 million shares, cash per share hits $11.73—well above the $8.27 close on September 26, with a $607.16 million market cap yielding a negative enterprise value of -$244.14 million. This undervaluation stems from trial delays and partnership dynamics, but the debt-free status (effectively) ensures no forced capital raises.

The advantage here is asymmetric: Minimal downside from the cash buffer, while PROTAC breakthroughs could validate a platform worth billions, attracting big pharma buyouts.

Green Dot Corporation (GDOT): Fintech Fortress with a Massive Cash Vault

Unlike its biotech peers, Green Dot Corporation operates in the more grounded realm of financial technology. As a registered bank holding company, it powers prepaid debit cards, digital banking, and payment platforms for underserved consumers and businesses—think Walmart’s MoneyCard or its B2B embedded finance solutions. Headquartered in Austin, Green Dot processes billions in transactions annually, capitalizing on the shift to cashless economies.

What sets it apart? An eye-popping $2.31 billion cash pile as of June 30, 2025, against $73.39 million in debt—less than 4% leverage. Per 55.39 million shares, that’s $41.71 in cash per share, towering over the $14.20 closing price and $786.58 million market cap. Enterprise value clocks in at a bizarre negative -$1.45 billion, reflecting regulatory headwinds and competition from neobanks, but underscoring the embedded value.

Investors get a stable, revenue-generating business (with recurring fees) essentially for free, backed by a war chest that could fuel acquisitions or share buybacks. Low debt amplifies resilience in economic downturns, when demand for affordable banking spikes.

Keros Therapeutics Inc. (KROS): Hematology Hope at a Discount

Keros Therapeutics is a clinical-stage biopharma zeroing in on hematologic disorders, developing novel activin receptor inhibitors to boost red blood cell production and treat conditions like myelodysplastic syndromes (MDS) and anemia. Its lead asset, KER-050, is in Phase 2 trials, with potential to address unmet needs in a market dominated by injectables.

Balance sheet-wise, Keros mirrors its peers: $690.21 million in cash at Q2 2025, dwarfing $17.95 million in debt. Cash per share? $17.00 across 40.62 million shares—edging out the $16.05 September 26 close and $651.88 million market cap, for a negative enterprise value of -$20.38 million. Clinical setbacks have pressured the stock, but the near-debtless structure provides a multi-year runway.

This translates to high-conviction value: Cash covers the downside, while positive trial data could catalyze a rerating in the $20 billion hematology space.

Navigating Risks in Cash-Rich Bargains

While these stocks offer compelling safety margins, they’re not risk-free. Biotechs like ALMS, ARVN, and KROS face binary trial outcomes and regulatory hurdles, potentially eroding cash through burns (though runways are long). GDOT contends with fintech disruption and consumer spending cycles.

In a market chasing growth narratives, these cash-heavy underdogs represent a contrarian play. With minimal debt and prices below cash per share, they embody the ultimate margin of safety—perfect for patient investors eyeing 2026 catalysts. As always, due diligence and diversification are key, but for value seekers, this quartet is worth a deeper look.

Disclosure: Author didn’t own any of the above at the time the article was written. No investment recommendations are expressed or implied.

Top 3 Stocks Using the Classic Ratios

by Fred Fuld III

Stock investors often rely on fundamental ratios to evaluate whether a company’s shares are attractively valued, fairly priced, or overvalued. Among the most widely used are the Price-to-Earnings (P/E) ratio, Price-to-Sales (P/S) ratio, Price-to-Earnings Growth (PEG) ratio, and Price-to-Book (P/B) ratio. Each of these measures captures a different perspective on valuation, and together they help investors build a more complete picture of a company’s financial standing and future prospects.

The P/E ratio is perhaps the most common valuation tool. It compares a company’s stock price to its earnings per share (EPS), essentially showing how much investors are willing to pay for each dollar of profit. A higher P/E ratio generally suggests that investors expect stronger future growth, while a lower P/E ratio may indicate undervaluation or weaker growth expectations. As regards to determining undervaluation, a P/E of less than 15 is good.

Within the P/E category, there is an important distinction between the trailing P/E and the forward P/E. The trailing P/E is based on the company’s actual earnings over the past twelve months, making it a snapshot of current profitability relative to stock price. By contrast, the forward P/E uses analysts’ earnings forecasts for the next twelve months, offering a more forward-looking perspective. While the forward P/E can highlight growth potential, it also carries greater risk of inaccuracy since it depends on estimates rather than historical data.

The Price-to-Sales ratio, or P/S ratio, provides another lens for valuation. Instead of focusing on profits, which can be influenced by accounting choices and one-time charges, the P/S ratio compares a company’s stock price to its revenue per share. This makes it especially useful for evaluating companies that are not yet profitable or are experiencing earnings volatility, such as startups or firms in cyclical industries. A lower P/S ratio may suggest that a stock is undervalued relative to its sales, though it should be interpreted in the context of profit margins and industry standards. A P/S ratio of less than 1 is considered good in terms of undervaluation of a stock.

The PEG ratio adds another layer of nuance by combining the P/E ratio with expected earnings growth. It divides a company’s P/E ratio by its projected annual earnings growth rate, providing a measure of whether the stock’s valuation is justified by its growth prospects. A PEG ratio of 1.0 is often seen as “fair value,” with higher numbers suggesting that investors are paying a premium for growth and lower numbers signaling potential undervaluation. The PEG ratio is particularly helpful for growth stocks, where high P/E ratios might otherwise appear expensive without considering the company’s future earnings potential.

The Price-to-Book ratio, or P/B ratio, compares a company’s stock price to its book value per share, which represents the net asset value of the company recorded on its balance sheet. This ratio is especially relevant for industries with significant tangible assets, such as financial institutions, real estate, and manufacturing. A P/B ratio below 1.0 can indicate that a stock is trading for less than the value of its assets, potentially signaling a bargain. However, in asset-light industries like technology, where intangible assets such as intellectual property drive value, the P/B ratio may be less meaningful.

Here are three companies all of which have all favorable ratios:

(MOS) The Mosaic Company

  • Trailing P/E: ~11.6
  • Forward P/E: Lower, roughly 10.8. This reflects analysts’ estimates of future earnings being higher than what was earned in the past twelve months. 
  • P/S (Price-to-Sales): Trailing P/S is about 0.96, forward P/S about 0.76.
  • P/B (Price-to-Book): MOS has a P/B of roughly 0.87. That is, the stock is trading below book value per share.
  • PEG: MOS’s PEG ratio is approximately 0.88. That means relative to its expected earnings growth, the stock appears modestly undervalued (a PEG below 1 is often seen as potentially favorable, depending on growth risk, etc.).

Interpretation for MOS: The forward P/E being lower than the trailing P/E suggests that earnings are expected to improve. Combined with a PEG under 1, and a P/B less than 1, it may indicate the market is not fully pricing in MOS’s growth or is cautious for some reason (commodity price risk, fertilizer demand, regulatory risk, etc.). The P/S near 1 also means price is roughly equivalent to sales, but profitability margins will matter a lot in assessing how attractive that is.

(GT) Goodyear Tire & Rubber

  • Trailing P/E: ~ 6.0.
  • Forward P/E: ~ 6.36. This is higher than its trailing P/E, suggesting that earnings are expected to be lower (or the growth is not strong) or that recent earnings were unusually good or a one-off.
  • P/S: Very low, around 0.13 trailing and forward.
  • P/B: ~ 0.48. The stock is trading well below its book value per share.
  • PEG: ~ 0.41 according to one source.

Interpretation for GT: Goodyear’s low trailing P/E, low P/S, and fairly low P/B suggest the market is strongly discounting its earnings prospects or anticipating trouble. The fact that forward P/E is higher than trailing P/E might suggest either earnings are expected to decline or that trailing earnings were boosted in the recent period. A PEG of ~0.48 might look attractive on its face, but one must question whether the growth assumptions underlying that PEG are realistic. For cyclical and capital-intensive businesses like tire manufacturing, external factors (rubber prices, labor costs, supply chain, demand cycles) can cause big swings.

(BFH) Bread Financial Holdings

  • Trailing P/E: ~ 10.8
  • Forward P/E: 7.0
  • P/S: 0.63
  • P/B: 0.94
  • PEG: 0.97

Interpretation for BFH: With a trailing P/E of about 10.6×, BFH is not extremely expensive on a historical earnings basis, and with a much lower forward P/E, further earnings growth is expected.

These examples illustrate how the fundamental ratios give different lenses — trailing vs forward P/E to see past vs expected earnings; P/S when profits might be volatile; P/B when assets matter; PEG to combine valuation with growth.

Taken together, these four fundamental ratios—P/E, P/S, PEG, and P/B—help investors analyze stocks from multiple angles, balancing current profitability, revenue generation, growth potential, and underlying asset value. None of them should be used in isolation, as industries and business models vary widely, but when combined they form a powerful toolkit for making informed investment decisions.

Disclosure: Author didn’t own any of the above at the time the article was written. No recommendations are expressed or implied.