Book Value per Share Calculator

The Book Value per Share (BVPS) is a key metric used by investors to determine the per-share value of a company based on its net assets. It helps in understanding whether a stock is undervalued or overvalued compared to its market price.

This calculator makes it easy for you to find the BVPS by simply entering three values: Total Shareholders' Equity, Preferred Equity, and Total Outstanding Shares.

Formula for Book Value per Share

The general formula for BVPS is:

$\text{BVPS}=\frac{\text{Total Shareholders' Equity}-\text{Preferred Equity}}{\text{Total Outstanding Shares}}$

Explanation of Formula Terms

1. Total Shareholders' Equity – The company's total assets minus its total liabilities, available to equity holders.
2. Preferred Equity – The portion of equity allocated to preferred shareholders (excluded from common shareholder equity).
3. Total Outstanding Shares – The total number of shares held by all shareholders, including institutional investors and company insiders.

Example Calculation

Let’s say:

• Total Shareholders' Equity = $10,000,000
• Preferred Equity = $2,000,000
• Total Outstanding Shares = 500,000 shares

Step 1: Subtract Preferred Equity from Total Shareholders' Equity:

$10,000,000-2,000,000=8,000,000$

Step 2: Divide the result by Total Outstanding Shares:

$\text{BVPS}=\frac{8,000,000}{500,000}=16$

Final BVPS = $16 per share

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Why Book Value per Share Matters

• For Investors: It helps in comparing the intrinsic value of a stock with its market price.
• For Analysts: Useful in identifying undervalued or overvalued stocks.
• For Companies: Indicates how much value each share holds in terms of company assets.