Tangible Book Value Per Share Banks

Royal bank of canada s tangible book value per share for the quarter that ended in jul.

Tangible book value per share banks. The formula for tbvps is. Total tangible equity is calculated as the total stockholders equity minus preferred stock minus intangible assets. If you can buy your stock below book value it s a really attractive financial trade.

Let s assume company xyz has 10 million in tangible assets which appears on the balance sheet and 1 million shares outstanding. Citi s consensus analyst target price is 76 15 and its 52 week range is 48 42. Tangible book value per share is calculated as the total tangible equity divided by shares outstanding eop.

Tbvps 10 000 000 1 000 000 10 00. Tbvps determines the potential value per share of a company in the. That makes share buybacks immediately accretive in terms of both earnings per share and tangible book value.

Further most investors understand that there is some tradeoff between earnings today and investing for higher earnings in the future. Book value per share tells investors what a bank s or any stock s book value is on a per share basis. Tangible book value per share valuation is inherently forward looking and historical growth rates are useful mostly as potential predictors of future growth.

Tangible book value total assets total liabilities intangible assets value goodwill 97 366 53 125 7 789 12 706 23 746 million the firm s tbv is 23 8 million. You are doing the right thing for shareholders you re supporting the price of the. Tbvps tangible assets shares outstanding.

Citigroup ended 2018 with a stated book value of 75 05 per share and a tangible book value of 63 79 per share. Most banks are sold for more than their tangible book value and berkshire s tangible book value at the end of the third quarter was 22 22 per share so it could have upside from here if it is. Many bank stocks are still trading below tangible book value.