Market Price To Book Value Per Share Formula
The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding.
Market price to book value per share formula. Here s the price to book value formula. Price to book value formula the price to book value can be defined as a market value of a firm s equity divided by the book value of its equity. 1 market to book ratio formula market value of stock book value per share on the other hand it can also be calculated by dividing the market capitalization by the total book value or tangible net worth of the company.
The price to book value ratio p b formula is also referred to as a market to book ratio and measures the proportion between the market price for a share and the book value per share. The market to book formula is. The stock price per share can be found as the amount listed as such through the secondary stock market.
The market price per share is simply the current stock price that the company is being traded at on the open market. Where net book value total assets total liabilities. The book value per share is a little more complicated.
The price to book ratio formula is calculated by dividing the market price per share by 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. This ratio is used by the investors and other stakeholders to understand how the company is performing or the market s perception about the company and particular stock.
The book value per share is considered to be the total equity for common stockholders which can be found on a company s balance sheet. It s calculated by dividing the company s stock price per share by its book value per share bvps. Share price net book value per share.
The formula for price to book value is the stock price per share divided by the book value per share. The market to book ratio is calculated by dividing the current closing price of the stock by the most current quarter s book value per share. The market to book value ratio is calculated by dividing the current market price per share by the book value per share as per the most recent quarter for the company.