Book Value Per Share Vs Tangible Book Value Per Share

To calculate the tangible book value per share malcolm finds that the firm s number of shares outstanding is 2 000 000 million.

Book value per share vs tangible book value per share. Tangible book value is the same thing as book value except it excludes the value of intangible assets. Since preferred stockholders have a higher claim on assets and earnings than common shareholders. An even better approach is to assess a company s tangible book value per share tbvps.

For example let s assume that company xyz has 10 000 000 shares outstanding which are trading at 3 per share. The firm s tbv is 23 8 million. Using the formula above we can calculate company xyz s price to tangible book value as follows.

The company also recorded 15 000 000 of tangible book value last year. Tangible book value total assets total liabilities intangible assets value goodwill 97 366 53 125 7 789 12 706 23 746 million. Tbvps 10 000 000 1 000 000 10 00.

Drawbacks of book value per share. Price to tangible book value 3 15 000 000 10 000 000 2 0. Price to tangible book value share price tangible book value per share.

How does tangible book value per share tbvps work. Market value per share vs. For example intangible factors affect the value of a company s shares and are left out when calculating the bvps.

Let s assume company xyz has 10 million in tangible assets which appears on the balance sheet and 1 million shares outstanding. Tbvps tangible assets shares outstanding. Understanding price to tangible book value ptbv in theory a stock s tangible book value per share represents the amount of money an investor would receive for each share if a company were to.