One Time Asset Sale Points To Major Catalyst For Stock Going Higher

I like finding companies who are selling off major portions of their asset base. If a transaction occurs there is a one time cash windfall that bolsters the balance sheet and potentially allows for a large return of capital.

These events don’t occur often. They are almost impossible to find in large cap land. With large cap stocks asset sales are typically priced in. Market caps are larger, liquidity is higher and valuations are at fair value.

To find the really interesting asset plays you have to search in small cap land, where few tend to tread. This means you are looking at companies without analyst coverage, typically low liquidity and little to no discourse from other investors.

I found a company like this today.

They have a large portion of their assets listed for sale. And if they sell these assets, they could get half of their market cap back in cold hard cash.

Even better, the company has a significant amount of net cash on their balance sheet already and an asset sale of this size could mean a significant return of capital to shareholders.

Let’s take a closer look at this interesting opportunity.