What does Price-to-Book (P/B) Ratio of 0 Mean?
A Price-to-Book (P/B) ratio of 1.0 indicates that the market price of a company’s stock is equal to its book value per share. In other words, investors are valuing the company at exactly the value of its net assets as recorded in its financial books. A P/B ratio of 1.0 may suggest that the stock is trading at fair value relative to its accounting worth, although further analysis is needed to assess factors such as growth prospects, profitability, and market conditions.
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