Book Value Per Ordinary Share Formula

Book value par value additional paid in capital retained earning.

Book value per ordinary share formula. The term book value is a company s assets minus its liabilities and is sometimes referred to as stockholder s equity owner s equity shareholder s equity or simply equity. The calculation is easy. When compared to the current market value per share the book value per share can provide information on how a company s stock is valued.

It is the amount that shareholders would receive if the company dissolves realizes cash equal to the book value of its assets and pays liabilities at their book value. If the value of bvps exceeds the market value per share the. Book value per share total common stockholders equity preferred stock number of common shares.

The book value per share bvps is calculated by taking the ratio of equity available to common stockholders against the number of shares outstanding. You just divide the book value of shareholders equity by the average outstanding ordinary shares outstanding. Book value per share total equity preferred shares average of outstanding ordinary shares.

In order to make a proper valuation of right relating to right shares the market value of the old holdings and the total issue price of the new holdings must be added and the same must be divided by the total number of new and old holdings. Book value indicates the difference between the total assets and the total liabilities and when the formula for book value per share is to divide this book value by the number of common shares. Here is the formula.

The book value per share formula is used to calculate the per share value of a company based on its equity available to common shareholders. Bvps frac total shareholder equity preferred equity total outstanding. The book value per common share formula below is an accounting measure based on historical transactions.

You can find the numbers in the owner s equity of the balance sheet. Book value per share bvps is a measure of value of a company s common share based on book value of the shareholders equity of the company. Where common stock at par par value number of shares issued.