Finding the 84% of Stock Market Value that Most Investors Ignore

Equity research firm Ocean Tomo recently released data on "intangible market value", that is, the value of assets within the S&P 500 that are NOT captured on the balance sheet as tangible assets:  cash, property, plant, equipment, inventory, and the like.  And the number is astounding:  84%!

Equities.com reports on those findings, linking the failure of Generally Accepted Accounting Principles (GAAP) to properly account for either the value contained by tech firms in information, relationships, intellectual property, or "eyeballs" to the value contained in social enterprises like soil remediation, ecological activity, and social capital.

We find this so interesting:  we often hear that small, local, sustainable businesses are "hard to value" because of the lack of "traditional" assets, which seemed odd in the light of astronomical valuations for tech firms proudly proclaiming their lack of business model or revenue plans.  What do you know, it turns out that most of the entire market's valuation is mostly made up of something else, something special, something "intangible".

Maybe we just need to look in different places to find the "value" and the opportunity for significant increases in that value, in our local sustainable food companies!