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Price to book value ratio

Price to book value ratio

Description

Price to book value ratio (P/B ratio) shows the company’s shares value by comparing market value with its’ book value. Data to calculate this ratio is collected from balance sheet and stock market bulletin.

Norms and limitations

In general, there are no norms for this ratio.

A lower P/B ratio could mean that the stock is undervalued. However, it could also mean that something is fundamentally wrong with the company. As with most ratios, be aware that this varies industry by industry.

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