CNH Global (NYSE:CNH) is a large worldwide player in agricultural and construction equipment. It may also be the latest example of that bane of novice investors: the value trap.

You read up on how investors like Graham and Buffett succeeded by buying cheap stocks. Then you find a company whose stock trades at a mere fraction of its book value. And then you see the company continue to erode away into nothingness, until you reach one of three unsatisfying destinations: bankruptcy, a lowball takeover, or a decision to simply sell the stock out of frustration.

That's the value trap in a nutshell. Sometimes the stocks of viable (albeit troubled) companies get pushed too low. I'm thinking here of examples like Wheeling-Pittsburgh (NASDAQ:WPSC) recently, or OM Group (NYSE:OMG) and Elan (NYSE:ELN) in late 2002. Other times, though, the stock almost perfectly reflects a doomed enterprise.

A long-term chart reveals that CNH hasn't been an especially good stock to own for the long haul. It doesn't help that the company is mostly owned by Fiat, a carmaker whose stock has also hit a few potholes over the last 15 years.

Fourth-quarter results for CNH weren't good, but there was no real expectation that they would be. Drought in Brazil has hurt the farm-equipment market in Latin America, and the markets in the U.S. and Europe aren't exactly robust, either. That situation neutralizes a lot of the growth in the construction business. As a result, CNH saw equipment sales fall a bit in the quarter, and total sales rose only 1%.

The company did sound a more optimistic about 2006; it seems to expect low single-digit growth. What's more, the company managed to improve margins in the fourth quarter. I believe that's noteworthy, given the sales performance and the impact of materials and energy costs.

So here's where CNH sits: The company trades for about half of book value. Peers and rivals like AGCO (NYSE:AG), Deere (NYSE:DE), and Terex (NYSE:TEX) trade at multiples of 1.04, 2.50, and 3.73, respectively, and the industry average is about 3.3. Though the company does have debt, it seems to be a reasonable and well-covered amount. While a discounted cash flow valuation doesn't suggest a lot of upside, expectations may still be low enough that value scroungers might want to take a look -- so long as they remain wary of the value trap.

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Fool contributor Stephen Simpson has no financial interest in any stocks mentioned (that means he's neither long nor short the shares).