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What is a GOOD Price to Book Ratio (P/B Ratio) and How to Interpret?
By IncomeBuddies.com  •  May 21, 2021
Price-to-Book Ratio (P/B) is a financial ratio used in ratio analysis to help identify potential undervalue stocks. Generally, value investors uses this to evaluate how undervalued, or overvalued is a stock at it’s current price. A higher number will indicate to be more expensive, and a lower number will indicate the stock to be less expensive. Price-to-Book Ratio (P/B) is also known as, PB Ratio or, Market-to-Book Ratio. Numbers to be considered in Price-to-Book Ratio are:
  • Market Price per Share
  • Total Shareholders’ Equity
  • Preferred Equity
  • Total Outstanding Shares
  • Book Value per Share (BVPS)
Price-to-Book Ratio is a relatively good way to determine if the stock is undervalue, or selling at a premium....
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