Price To Book Value Per Share Formula
Bvps 50 000 2000 25 per share.
Price to book value per share formula. The market price per share is simply the current stock price that the company is being traded at on the open market. In contrast to book value the market price reflects the future growth potential of the company. 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. The book value per share is a little more complicated. Price to book value market price per share book value per share.
Share price number of shares outstanding total assets and total liabilities. The stock price per share can be found as the amount listed as such through the secondary stock market. Book value per share book value of equity total shares outstanding.
Book value per share is also used in the return on equity formula or roe formula when calculating on a per share basis. Price to book p b stock price per share book value per share book value per share total assets total liabilities number of outstanding shares you can find this information on a company s financial statements. 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.
The price to book ratio or market to book ratio can easily be calculated in excel if the following criteria are known. Market share price rs 100. Book value per share rs 30 per share.
Hence book value per share is calculated as. Market cap is equal to share price times shares outstanding. Investors need to look at both the book value and market value of the share.