Market To Book Value Calculator

It relates the firm s market value per share to its book value per share.

Market to book value calculator. Market to book ratio market price per share book value per share. This calculator readily calculates the market to book ratio when the user enters information such as market price no. The market value is the current stock price of all outstanding shares i e.

The price that the market believes the company is worth. It is very easy and simple. In the below market to book ratio calculator enter the market value and book value.

It is calculated by dividing the current closing price of the stock by the latest quarter s. The price to book ratio calculator is used to calculate the price to book ratio p b ratio. 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.

This comparison shows if the share prices are a true representation of the net worth of the company making it possible to investigate if the share price is overstated or understated. It is important to understand the market to book value ratio when it is less than 1 and greater than 1. This p b ratio indicates the company s ability to create value for its stockholders.

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. You can easily calculate the price to book value using formula in the template provided. You need to provide the two inputs i e market price per share and book value per share.

This is done by comparing the book value figure with the market value of the company. Conversely the higher the book value the lower the ratio. Use of price to book value formula the price to book value formula can be used by investors to show how the market perceives the value of a particular stock to be.