Tangible book value per share is the pershare value of a companys equity after removing any intangible assets. The tangible book value number is equal to the companys total book value less the value of any intangible assets. Also defined as a firms next asset value, book value per share is. Tbvps determines the potential value per share of a company in the event that it must liquidate its assets. The current value of an investment on the trading market will be given to an investor if a company is no longer conducting business operations. Book value also known as equity, shareholders funds, or net asset value is the value of all a companys assets, minus its liabilities. Book value per share tells investors what a banks, or any stocks, book value is on a pershare basis. Pricetobook value pb is the ratio of market value of a companys shares share price over its book value of equity. In depth view into wells fargo tangible book value per share including historical data from 1972, charts, stats and industry comps. Simply stated, book value per share defines the accounting value i. For example, real estate investment trusts and manufacturers of various products. Price to tangible book value share price tangible book value per share. Tangible book value per share book value also known as equity, shareholders funds, or net asset value is the value of all a companys assets, minus its liabilities.
Understanding book value net tangible assets on a balance sheet. The formula for the price to tangible book value is. The term tangible book value refers to a measure that allows the. Net tangible assets nta is the value of all physical tangible assets minus. Computed by deducting intangible assets, startup expenses, and deferred financing costs from the firms normal book value bv.
The price to tangible book value ptbv is a valuation ratio expressing the price of a security compared to its hard, or tangible, book value as reported in the companys balance sheet. How to figure the book value of bank stock finance zacks. Tangible book value per share tbvps definition investopedia. Tangible book value per share tbvps is the value of a companys tangible assets divided by its current outstanding shares. People often get confused between book value and market value while investing. The tangible book value per share tbvps shows the amount per share that shareholders would expect if the firm was liquidated today. The price to tangible book value ratio ptbv expresses share price as a proportion of the companys tangible book value reported on the companys balance. Assets such as property and equipment are considered to be tangible assets. What is book value per share and how can it help you in. What is book value, market value and face value of share. What is book value per share and how can it help you in investing. When book value per share is high compared to a companys share price, the companys stock is deemed as undervalued. Also defined as a firms next asset value, book value per share is essentially the total assets of a company, but not counting a firms assets and liabilities.
A tangible asset is anything that has commercial or exchange value and has a physical form. The nta per share, or book value per share, is simply the nta divided by the number. The book value of equity, in turn, is the value of a companys assets expressed on the balance sheet. Calculate a businesss quality with book value the balance. The book value per share is calculated using historical costs, but the market value per share is a forwardlooking metric that takes into account a companys earning power in the future. With increases in a companys estimated profitability, expected growth. To arrive at this number, subtract liabilities from assets. Book value is a component in many ratios that investors. Tangible book value per share tbvps equals a companys net tangible assets divided by its number of shares outstanding. View tangible book value per share for rf access over 100 stock metrics like beta, evebitda, pe10, free cash flow yield, kz index and cash conversion cycle. But when warren buffett measures his performance at berkshire hathaway, he does so differently, looking to the balance sheet to find the change in book value per share as a measure of his ability. Tangible book value per share is the per share value of a companys equity after removing any intangible assets.
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