Vaso Corporation ($VASO) is a small company with a $52MM market cap and $48MM in cash.
Until recently consisted of three separate businesses, the professional sales segment, which represents GE Healthcare (NASDAQ: GEHC) in selling diagnostic equipment; the medical device segment; and the IT segment.
The professional sales segment is the real money-maker, while the medical equipment and IT segment have historically lost money.
In 2025/2026, the company sold off its loss-making IT segment for a big pile of cash. (Part of that segment, NetWolves, sold off for $14.5MM in July.)
The IT segment had for a long time obscured the stellar performance of its professional sales division.
Now that it's gone, I believe it can conservatively make $3MM of EBIT per year.
Given that the company also has no debt, its enterprise value (EV) is just $4MM.
This gives VASO a ridiculous multiple of 1.3x EV/EBIT. Needless to say, a valuation like this is very unusual, and as the earnings show up in the next few quarters I doubt it will stay so low.
*How is this possible?*
I believe some investors have concerns with two aspects of the company. First has to do with customer concentration. Revenue from VASO's professional sales segment comes exclusively from GE Healthcare.
They've been working together since 2010 and their current contract was extended until 2030. I don't see why they wouldn't keep working together, but I think that's what some worry about.
Second, I think some investors are concerned about capital allocation. The company has never paid a dividend and authorized only a small buyback over a decade ago. No one has any idea what they will do with all this cash.
I think the biggest risk is that they make a poor acquisition. (The business they sold off, NetWolves, was originally purchased for $18MM in 2015.)
Still, it doesn't seem like the low valuation is warranted. What do you guys think?
If you want to see my full thoughts I wrote it up here: [https://thinlytraded.substack.com/p/the-cheapest-stock-i-still-own](https://thinlytraded.substack.com/p/the-cheapest-stock-i-still-own)
***Disclosure: Long VASO.***
