Liquidation

Operating Liquidation Value

Cash + Accounts Receivable + Inventory − Total Obligations

Operating Liquidation Value (OLV) measures what shareholders would recover if a company ceased operations today and liquidated its three most liquid operational asset classes — cash, receivables, and inventory — after settling all obligations. Total Obligations includes current liabilities, long-term debt, and lease obligations under ASC 842. This metric follows Benjamin Graham’s net-net framework, modernized for current XBRL reporting standards. Inventory is less liquid than receivables — it must be sold or auctioned, potentially at a discount — but for companies with physical goods, it represents a significant source of recoverable value. The difference between LLV and OLV reveals how much value is locked in inventory. A positive OLV is rare and signals a company trading below its liquidation floor.

Total Obligations

Total Obligations = Current Liabilities + Long-term Debt + Operating Lease Liability + Finance Lease Liability. This captures all balance sheet obligations, including lease commitments recognized under ASC 842.

XBRL Fields Used

Cash: CashAndCashEquivalentsAtCarryingValue
Accounts Receivable: AccountsReceivableNetCurrent / ReceivablesNetCurrent
Inventory: InventoryNet
Current Liabilities: LiabilitiesCurrent
Long-term Debt: LongTermDebt / LongTermDebtNoncurrent
Operating Lease Liability: OperatingLeaseLiability
Finance Lease Liability: FinanceLeaseLiability

Banks and REITs: Financial institutions (banks, insurance companies) and REITs have fundamentally different balance sheet structures. Their current liabilities include customer deposits and policy reserves that are not comparable to operating company obligations. These companies are flagged in the data but not excluded — interpret their liquidation metrics with caution.

ASC 842 Lease Treatment: Total Obligations includes operating and finance lease liabilities recognized under ASC 842 (effective 2019). For companies that adopted ASC 842, these lease obligations appear on the balance sheet. For pre-adoption periods, the fallback tags OperatingLeasesFutureMinimumPaymentsDueTotal and CapitalLeaseObligations are used where available.

These metrics are derived from publicly available financial statements filed with the SEC and involve simplifying assumptions about asset realization and liability settlement. Actual outcomes in a liquidation scenario may differ significantly due to market conditions, legal priorities, asset impairments, and other factors not fully captured in reported data.