Price-to-Book Ratio (P/B)
What is Price-to-Book Ratio?
A company's share price divided by its book value per share.
Understanding Price-to-Book Ratio
The P/B ratio compares what the market pays for a company with the accounting value of its net assets. A P/B below 1 means the stock trades for less than its book value.
P/B is most meaningful for companies with mostly tangible assets, such as banks and insurers.