Cash in bank15 Mar 2021 22:53
I was drawn to investigate Galliford based on the fact that it seems on the surface that you get the business for free given that the market cap is broadly in line with the cash at hand.
However, if we take net current assets (from the HY report), we have £-22M.
I was hoping the roughly £150M average month-end cash position would act as a bottom line in terms of a liquidation value for the company. Given that the profit margin is so low, I wouldn't be investing in this because I love the business, I'd be investing because there's the potential for a decent upside if they hit their future operating margin and revenue targets, and the downside would be minimal if it's backed by such a high amount of cash. I think based on some of the other comments here others are approaching it the same way. The problem with this approach is that if they did shut up shop tomorrow, I assume they'd still need to pay off their liabilities, leaving the shareholders with no tangible assets left. Maybe I'm wrong, but that's they way I'm looking at this cash pile.