Quanex Building Products (NX) shows deeply negative equity recovery under a liquidation lens, consistent with MFFAIS CLV of -$1.82B and OLV of -$1.36B. The balance sheet as of January 31, 2026 reflects a post-Tyman-acquisition structure with total assets of $1.978B against total liabilities of $1.248B and book equity of $730M. Under liquidation haircuts, the asset side collapses materially. Cash of $62M recovers at par. AR of $189M at 90-95% yields ~$177-180M. Inventory of $271M at 60% yields ~$163M. PP&E gross of $832M with $430M accumulated depreciation yields net book $402M; at 50-60% of net book that implies ~$200-241M. The largest destruction of value comes from intangibles: goodwill of $275M and finite-lived intangibles net of $544M total $820M in balance-sheet intangibles that recover $0 in liquidation. Deferred tax liabilities of $140M remain a face-value obligation. The facility debt stack is $662M outstanding under the Wells Fargo credit facilities (revolving and Term A) plus $55.5M in finance leases and other debt, of which $49.3M is real estate leases per MD&A. Operating lease liabilities total $185M ($17M current, $169M non-current) which do not extinguish on winding down. Total debt and lease obligations approximate $900M+ face value against tangible asset recovery of roughly $640-700M on generous assumptions, leaving a large negative residual before any liquidation costs, severance, or wind-down expenses. Period-over-period change from the prior 10-K (fiscal year ended October 31, 2025) is modest on a balance-sheet basis: goodwill moved from $271M to $275M, driven purely by $4.1M in FX translation gains. No impairment. Intangibles declined by approximately $9.8M (one quarter of amortization). Debt declined slightly as $57M revolving draws were partially offset by $36.25M repayments and $0.84M finance lease payments, but net outstanding credit facility balance of $662M remains the dominant liability. The filing discloses a material weakness in cash flow statement controls identified in the FY2025 10-K, not yet remediated as of January 31, 2026 — this does not alter the liquidation math but introduces some reliability risk on cash flow classifications. Finance lease real estate obligations ($49.3M) are discussed in MD&A but the filing does not separately tag real estate finance lease liability in XBRL. The Tyman acquisition (August 2024) added substantial intangible mass and the debt load that now drives the negative recovery posture.
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