Price to Book Ratio (TTM)
Returns the Price to Book ratio, which compares a company's market value to its book value (shareholders' equity).
P/B Formula
P/B Ratio = Market Cap / Book Value Or: P/B Ratio = Stock Price / Book Value Per Share
Understanding P/B
| P/B Range | General Interpretation |
|---|---|
| < 1 | Trading below book value (potentially undervalued or distressed) |
| 1-3 | Common for established companies |
| 3-10 | Growth premium, intangible assets |
| > 10 | High growth, asset-light business |
Industry Differences
| Industry | Typical P/B |
|---|---|
| Banks | 0.8 - 1.5 |
| Insurance | 1.0 - 2.0 |
| Tech | 5 - 20+ |
| Manufacturing | 2 - 5 |
Parameters
| Parameter | Description |
|---|---|
| Symbol | Stock ticker symbol |
Examples
=PricePerBook("AAPL")=PricePerBook("JPM")=PricePerBook("BAC")=PricePerBook("BRK.B")=PricePerBook(A1)When to Use
- Value asset-heavy companies (banks, insurance)
- Identify potentially undervalued stocks (P/B < 1)
- Compare similar companies
- Warren Buffett-style value investing
- Banking sector analysis
When NOT to Use
| Scenario | Use Instead |
|---|---|
| Need earnings-based valuation | PERatio() |
| Need revenue-based valuation | PricePerSales() |
| Need cash flow valuation | CashFlowPerShare() |
| Tech/service companies | P/E or P/S often more relevant |
Common Issues & FAQ
Q: Why is P/B returning "NA"? A: Check that:
- The symbol is valid
- The company has positive book value
- Financial statements are available
Q: Why are tech stocks' P/B so high? A: Tech companies often have few tangible assets but significant intangible value (IP, brand, talent) not reflected in book value.
Q: When is P/B most useful? A: P/B is most useful for asset-heavy industries like banks, insurance, and real estate where book value is meaningful.
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