Book Value Per Common Share Definition & Meaning | Fundamental Analysis | CSIMarket
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Glossary

Book Value Per Common Share

Fundamental Analysis

Book Value Per Common Share (BVPS) is a financial metric used to determine the value of a company*s shares. It represents the total value of a company*s assets minus the value of its liabilities, divided by the number of outstanding shares of common stock.

The formula for calculating BVPS is as follows:

BVPS = (Total Shareholders* Equity - Preferred Share Stock) / Shares Outstanding

BVPS can be found in a company*s balance sheet, as it is a key part of its financial position. It provides investors with a measure of the company*s net worth per common share, which can be used to evaluate the company*s performance and health.

Fundamental analysts typically use BVPS to help determine the intrinsic value of a company*s common stock. They will compare a company*s BVPS with its current market price, as well as with the BVPS and market prices of other companies in the same industry. This analysis can provide insight into whether a company*s common stock is undervalued or overvalued.

Investors can also use BVPS to evaluate a company*s financial stability, as it represents a snapshot of the company*s financial position at a specific point in time. A higher BVPS indicates that a company has greater equity in its assets, which can provide a cushion against financial difficulties or potential bankruptcy.

Overall, BVPS is an important financial metric that is used in fundamental analysis to evaluate the value and performance of a company*s common stock.


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