The precipitous decline in the price of Research In Motion stock has left the market capitalization of the BlackBerry maker below the value of its cash, receivables and other current assets.
Shares in the Canadian smartphone maker fell another 4 percent, to less than $13, on the Nasdaq on Monday.
The shares fell 11 percent on Friday after RIM offered a dismal outlook and said it was delaying release of its make-or-break new smartphones until late 2012.
They have lost more than half their value since the day before reporting second quarter earnings back in September.
The fall gives RIM a market capitalization of less than $7 billion. RIM last week said it had current assets - which include short-term investments and discounted inventory - of $7.2 billion.
That does not include long-term investments, property and intangible assets such as patents. RIM values those additional assets at about $7 billion.
"The problem is it's a tech stock where revenue and earnings are declining year-over-year and the fundamentals are deteriorating," said Susquehanna Financial analyst Jeff Fidacaro, who considers $12 a possible floor, based mostly on a valuation of RIM's patents and its services business.
RIM is struggling to move its smartphones across to the QNX operating system that powers its poorly-received PlayBook tablet computer. Even at the current price, potential acquirers are seen as likely to sit back until the switch is done, meaning there is no takeover premium to limit the fall.
RIM is struggling to move its smartphones across to the QNX operating system that powers its poorly-received PlayBook tablet computer. Even at the current price, potential acquirers are seen as likely to sit back until the switch is done, meaning there is no takeover premium to limit the fall.
"The challenge becomes for a natural acquirer to see that integration challenge internally," said Fidacaro, who points to a February software update for the PlayBook as the next potential positive catalyst for the stock.
RIM has suffered this year through a massive network outage, a deteriorating U.S. market share and a string of botched and delayed product launches, with its shares slumping from a high of more than $70 in February to the current level, the lowest since early in 2004, when RIM was just adding a color screen to its "email pagers".
But it's still posting solid quarterly sales - cash flow from operations was $1.8 billion in the third quarter - unlike the failed or struggling companies it is often compared to.
"It's not Palm which everyone is worried about," Fidacaro said, referring to a former rival which burned through cash as it fought to reinvigorate itself. Palm was later bought by Hewlett-Packard.
RIM said it will spend $100 million to promote its BlackBerry 7 phones, which JMP Securities analyst Alex Gauna said will be destructive to sentiment.
"Investors are likely to worry over a shift to cash consumption and hence erosion in tangible book value that the stock is closing on," he wrote.
"Worse, consumers that fall prey to promotional activities likely come away disappointed in poorly performing and buggy devices, hence deepening damage to the brand ahead of Blackberry 10," he said, referring to the QNX-based devices initially promised for early in 2012 but now due out late next year.