The PBV is a financial ratio that is used to compare a company's book value to its current market price. Book value denotes the portion of the company held by shareholders.
Formula:
PBV = Market Capitalization / Total Book Value as per the Balance Sheet
Or
PBV = Market Value per Share / Book Value per Share
Book Value per Share = Total Book Value / Total No. of outstanding shares
A point to note here is that, PBV ratios do not directly provide us any information on the company's ability to generate profits for itself or its shareholders. It gives us some idea of whether an investor is paying too much for what would be left if the company were to go bankrupt immediately.
A good price to book ratio for investing in a company is typically considered to be below 1.5. This ratio compares a company's market value to its book value, with a lower ratio indicating that the company may be undervalued.
The price-to-book ratio compares a company's stock price to its book value per share. A lower ratio may indicate that the stock is undervalued, while a higher ratio may suggest it is overvalued. Investors can use this ratio to assess if a stock is a good investment based on its perceived value relative to the company's assets.
Its fun.
A stock multiple is the ratio of a stock's price to various other financial measures. Most commonly used are price-to-book, which is the total value of a company's stock vs. its book value, and price-to-earnings or PE ratio.
A good price-to-book ratio is typically considered to be below 1. It can be used to evaluate a company's financial health by comparing the market value of a company's stock to its book value, which is the value of its assets minus its liabilities. A low price-to-book ratio may indicate that a company's stock is undervalued, while a high ratio may suggest that the stock is overvalued.
It should not be more than 1.5. If book value is more than price then margin of safety is there. The share price can be higher than book value but not more than 1.5.
A good price-to-book ratio for a company is typically considered to be below 1.0. This indicates that the company's stock price is lower than its book value, which may suggest that the stock is undervalued.
A good price to book ratio for evaluating a company's stock is typically between 1 and 3. This ratio compares the stock price to the company's book value per share, providing insight into whether the stock is undervalued or overvalued.
market/book ratio (M/B)
A negative price-to-book ratio indicates that the company's stock is trading below its book value per share. This could suggest that the market has a negative perception of the company's financial health or future prospects.
Market debt ratio= TL / (TL - Equity) Note : equity with market value .
Salvage Value - [Tax * (Market Value - Book Value)