The Business of Value Investing.pdf

166 The Business of Value Investing

Table 8.1 Stated Liquidation Value of DryShips

Balance Sheet Entry Value

Assets $5.2 billion

Liabilities $3.1 billion

Shareholders’ equity $2.1 billion

Shares outstanding 43 million

Book value per share $49

Source: SEC 10-Q Filing for quarter ending September 2008.

Table 8.2 Conservative Liquidation Value of DryShips

Balance Sheet Entry Stated Value Conservative Value

Assets

Current assets $456 million $425 million

Fixed assets $3.9 billion $2.9 billion

Other noncurrent assets $811 million $120 million

Total Assets $5.2 billion $3.4 billion

Liabilities

Current liabilities $637 million $637 million

Noncurrent liabilities $2.4 billion $2.4 billion

Total Liabilities $3.1 billion $3.1 billion

Shareholders’ equity $2.1 billion $300 million

Shares outstanding 43 million 43 million

Book value per share $49 $7

Source: SEC 10-Q Filing for quarter ending September 2008.

To provide maximum protection for the investor, very conserva-

tive adjustments were made to the asset side of the balance sheet.

Current assets, of which $ 311 million were represented by cash,

were essentially left alone. On the fi xed asset side, conservative and

CH008.indd 166CH008.indd 166 9/2/09 11:48:59 AM9/2/09 11:48:59 AM