What is RNAV? Is it the same as NAV? How do you calculate RNAV

[Xiaosaint]

Hi fellow Valuebuddies!

I saw a few forum posts mentioning about investing in companies with prices lower than its RNAV.

I tried searching online and there seems to be little information about what RNAV is and how to calculate it.

Anyone care to share? Thanks!!!

[BlueKelah]

Hi fellow Valuebuddies!

I saw a few forum posts mentioning about investing in companies with prices lower than its RNAV.

I tried searching online and there seems to be little information about what RNAV is and how to calculate it.

Anyone care to share? Thanks!!!

The R can stand for revalued, restated and revised. I prefer to call it revised NAV, but call it revalued and restated if you would like

Mostly used by analyst to assign a higher number to the stated NAV in the financial reports. The analyst will adjust all the companies assets and liabilities to market value.

RNAV per share = (Revised assets market value - Revised liabilities value) ÷ number of shares.

Mostly used for property companies with extra land valued at old prices or projects which profits/value are not reflected. Do note that sometimes having a higher RNAV is useless if no one is interested in the stock or if the company just has lots of land/assets sitting around and not doing much about it.

[theasiareport]

I always like to think of it as "real net asset value". With a bit of accounting knowledge, you can understand the quirks of why some of these peculiarities exist (depreciation policy, booking at cost etc).

[Curiousparty]

realizable NAV.

[Ray168]

Most of the time RNAV show positive, due to potential future market value or inflation.

However, there are time when RNAV is negative, i.e. when economy is in depression.

Take note that NAV is make up of tangible and intangible assets (goodwill, brand or patent right,etc). So, it is better to be conservative to consider using NTA (net tangible asset).

Hi fellow Valuebuddies!

I saw a few forum posts mentioning about investing in companies with prices lower than its RNAV.

I tried searching online and there seems to be little information about what RNAV is and how to calculate it.

Anyone care to share? Thanks!!!

The R can stand for revalued, restated and revised. I prefer to call it revised NAV, but call it revalued and restated if you would like

Mostly used by analyst to assign a higher number to the stated NAV in the financial reports. The analyst will adjust all the companies assets and liabilities to market value.

RNAV per share = (Revised assets market value - Revised liabilities value) ÷ number of shares.

Mostly used for property companies with extra land valued at old prices or projects which profits/value are not reflected. Do note that sometimes having a higher RNAV is useless if no one is interested in the stock or if the company just has lots of land/assets sitting around and not doing much about it.

[level13]

As curiousparty has pointed out earlier, the R stands for realisable. Hence, RNAV means realisable net asset value.

In order to calculate RNAV, you remove the goodwill and intangibles from assets in the balance sheet and offset the remaining amount against the liabilities. The ouput will be the RNAV.

When applying this calculation, the assets you are using will be mainly equipment, inventories & cash. Normally to be conservative, i tend to apply a further discount on the equipment & inventories. Thus, the final number will be even smaller and this ties back to the net-net stock concept which i mentioned in my other post earlier.

[beau]

Take note that NAV is make up of tangible and intangible assets (goodwill, brand or patent right,etc). So, it is better to be conservative to consider using NTA (net tangible asset).

As curiousparty has pointed out earlier, the R stands for realisable. Hence, RNAV means realisable net asset value.

In order to calculate RNAV, you remove the goodwill and intangibles from assets in the balance sheet and offset the remaining amount against the liabilities. The ouput will be the RNAV.

When applying this calculation, the assets you are using will be mainly equipment, inventories & cash. Normally to be conservative, i tend to apply a further discount on the equipment & inventories. Thus, the final number will be even smaller and this ties back to the net-net stock concept which i mentioned in my other post earlier.

Sorry to bump an old thread, but these 2 posts seem to conflict each other.

What Ray168 says doesn't make sense... Aren't NAV and Net Tangible assets synonyms for (Total Assets - Intangible Assets - Total Liabilities)?

[smallcaps]

Take note that NAV is make up of tangible and intangible assets (goodwill, brand or patent right,etc). So, it is better to be conservative to consider using NTA (net tangible asset).

As curiousparty has pointed out earlier, the R stands for realisable. Hence, RNAV means realisable net asset value.

In order to calculate RNAV, you remove the goodwill and intangibles from assets in the balance sheet and offset the remaining amount against the liabilities. The ouput will be the RNAV.

When applying this calculation, the assets you are using will be mainly equipment, inventories & cash. Normally to be conservative, i tend to apply a further discount on the equipment & inventories. Thus, the final number will be even smaller and this ties back to the net-net stock concept which i mentioned in my other post earlier.

Sorry to bump an old thread, but these 2 posts seem to conflict each other.

What Ray168 says doesn't make sense... Aren't NAV and Net Tangible assets synonyms for (Total Assets - Intangible Assets - Total Liabilities)?

NAV = Book Value = NTA + Intangibles
NCAV = net net = Current assets - All liabilities

AFAIK, for NCAV, no need to further discount for the equipment or inventories as it already contains a discount since fixed assets were left out.
level13 is probably talking about the more detailed method in computing a liquidation value for a manufacturing company, in which each asset category is assigned a discount.

[beau]

Take note that NAV is make up of tangible and intangible assets (goodwill, brand or patent right,etc). So, it is better to be conservative to consider using NTA (net tangible asset).

As curiousparty has pointed out earlier, the R stands for realisable. Hence, RNAV means realisable net asset value.

In order to calculate RNAV, you remove the goodwill and intangibles from assets in the balance sheet and offset the remaining amount against the liabilities. The ouput will be the RNAV.

When applying this calculation, the assets you are using will be mainly equipment, inventories & cash. Normally to be conservative, i tend to apply a further discount on the equipment & inventories. Thus, the final number will be even smaller and this ties back to the net-net stock concept which i mentioned in my other post earlier.

Sorry to bump an old thread, but these 2 posts seem to conflict each other.

What Ray168 says doesn't make sense... Aren't NAV and Net Tangible assets synonyms for (Total Assets - Intangible Assets - Total Liabilities)?

NAV = Book Value = NTA + Intangibles
NCAV = net net = Current assets - All liabilities

AFAIK, for NCAV, no need to further discount for the equipment or inventories as it already contains a discount since fixed assets were left out.
level13 is probably talking about the more detailed method in computing a liquidation value for a manufacturing company, in which each asset category is assigned a discount.

Hi smallcaps,

Thank you for the reply.

Why do you suddenly talk about NCAV? There are no doubts on that.

Also, your formula for NAV = Book Value = NTA + Intangibles seems to conflict with the definition of NTA here: http://www.investopedia.com/terms/n/nett...assets.asp
where it says that NAV = Book value = NTA.

It seems like there are many different interpretations to these terms :/

[specuvestor]

Yes there are subtle differences. You might want to check out my post in another similar thread:

http://www.valuebuddies.com/thread-4123-...l#pid88193