Book Value - What is a good book value per share?

Q: What is a good book value per share?

The price-to-book (P/B) ratio has been favored by value investors for decades and is widely used by market analysts. Traditionally, any value under 1.0 is considered a good P/B value, indicating a potentially undervalued stock. However, value investors often consider stocks with a P/B value under 3.0.

Answer

For many years, market analysts and value investors alike have relied on the price-to-book (P/B) ratio. In the past, a P/B number below 1.0 was seen as a positive indicator of an inexpensive company. A P/B number below 3.0 is, nevertheless, frequently considered by value investors.

Book Value - What is a good book value per share?

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