Book Value Per Share Vs Par Value

The book value per share and the market value per share are some of the tools used to evaluate the value of a company s stocks.

Book value per share vs par value. The market value per share represents the current price of a company s shares and it is the price that investors are willing to pay for common stocks. Par value is the face value of an asset as it is entered into the company s charter. Par value is the price of a financial instrument at the time it is issued while its market value is the price it is worth to buyers and sellers at any given moment.

While book value per share is a good way to evaluate a stock it s more of an accounting based tool and doesn t necessarily reflect the true market value of a publicly traded company companies. Book value is the value that is written into a company s books for as asset. The book value per share bvps is a ratio that weighs stockholders total equity against the number of shares outstanding.

Book value is the value of an asset reported in the balance sheet of the firm. Par value is the issue price of a security or stock book value is the value derived from the balance sheet of a stock where the value of stock is given by the sum of equity and reserves divided by number of shares in issue while market value is the on going price of a security determined by market forces of demand and supply. Book value per share.

In other words this measures a company s total assets minus its total liabilities on a per share basis. Book value per common share or simply book value per share bvps is a method to calculate the per share book value of a company based on common shareholders equity in the company. The difference between the two is.