Book Value Per Share Of Capital Stock

When compared to the current market value per share the book value per share can provide information on how a company s stock is valued.

Book value per share of capital stock. It is equal to the price per share divided by the book value per share. For example a company that is currently trading for 20 but has a book value of 10 is selling at twice its equity. The preferred stock shown above in the stockholders equity section is cumulative and dividends amounting to 48 000 are in arrears.

This change is attributed to the value of the common stock at par which has been issued at the time of ipo. The book value per share may be used by some investors to determine the equity in a company relative to the market value of the company which is the price of its stock. In this balance sheet in the equity column two components are mentioned.

Book value per common share or simply book value per share bvps is a method to calculate the per share book value of a company based on common shareholders equity in the company. First is equity share capital which has changed from 5615 4 million to 6240 7 million from 2016 to 2017. 1 owners contribution common stock additional paid in capital common stock is the equity capital at the par value of the shares and the additional paid in capital is the excess capital over an above the par value.

The price to book p b ratio is a popular way to compare market value and book value. If the value of bvps exceeds the market value per share the. Calculate book value per share from the following stockholders equity section of a company.

That means change is around 625 4 million. The book value of a company stripped to basics is the value of the company the stockholders will own if the firm s. Book value of equity per share bvps is the ratio of equity available to common shareholders divided by the number of outstanding shares.

The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding. For example a company has a p b of. 2 treasury shares.