Price-to-Book Ratio (P/B) Calculator
Calculate a stock’s price-to-book ratio from per-share figures or company totals. Optionally test a target P/B and see its implied price or market capitalization.
Use a consistent share class, reporting date, currency and accounting basis. A P/B ratio is a comparison metric, not a standalone valuation or investment recommendation.
Price-to-book ratio formula
P/B = share price ÷ book value per share. An equivalent company-level calculation is market capitalization ÷ common shareholders’ equity, provided both figures refer to the same common share class and date.
Book value per share (BVPS) = common shareholders’ equity ÷ common shares outstanding. The calculator’s company method can use the share count to derive BVPS and an implied share price for a target P/B ratio.
Checked examples
- A share price of $30 and BVPS of $15 give P/B = 30 ÷ 15 = 2.00×. At a target of 1.50×, implied price is $22.50, or 25% below $30.
- Market capitalization of $4,800 million divided by common equity of $2,400 million gives 2.00×. With 160 million shares, BVPS is $15 and the same 1.50× target implies a $22.50 share price and $3,600 million market capitalization.
How to interpret and where it can mislead
P/B compares the market value of common equity with its reported book value. A value below 1.0× does not by itself mean a stock is undervalued; it may reflect expected losses, asset impairments, weak returns, or accounting differences. A high ratio can reflect expected returns or assets not fully captured on the balance sheet. Compare similar businesses and periods rather than treating a single threshold as “good.”
If common equity or BVPS is zero or negative, P/B is undefined or not meaningfully comparable, so this calculator requires a positive denominator. Use equity attributable to common shareholders, exclude preferred equity where appropriate, and match the share count and market capitalization to the same class and date. Book values are accounting amounts, not current market valuations; the result does not adjust for goodwill, intangible assets, treasury shares, or diluted securities.
Related tools: P/E Ratio Calculator, Enterprise Value Calculator, DCF Calculator, and ROIC Calculator.