Book Value Per Share (BVPS)

Valuation Component Investment Wiki — Fundamentals
Book Value Per Share (BVPS) takes the total shareholder equity of a company (assets minus liabilities) and divides it by the number of outstanding shares. It represents the theoretical dollar value a shareholder would receive if the company liquidated today.
Quick Reference
Type Valuation Component
Formula (Total Equity - Preferred Equity) ÷ Outstanding Shares
Primary Use The denominator for the P/B ratio

1.0 The Formula

Basic Form

formulaBVPS = (Total Shareholders' Equity - Preferred Stock) / Average Outstanding Common Shares

If a company's balance sheet has $1 Billion in pure equity and 100 million shares outstanding, the BVPS is $10.00. This is the bedrock floor value of the company.

3.0 Related Pages

Price-to-Book (P/B) Ratio

By comparing the BVPS to the actual market stock price, you get the P/B multiple.