What is the book value of a company?

The book value of a company is the net difference between that company’s total assets and total liabilities, where book value reflects the total value of a company’s assets that shareholders of that company would receive if the company were to be liquidated. An asset’s book value is equivalent to its carrying value on the balance sheet.

What is a book value figure?

The book value figure is typically viewed in relation to the company’s stock value ( market capitalization) and is determined by taking the total value of a company’s assets and subtracting any of the liabilities the company still owes. The company’s balance sheet also incorporates depreciation in the book value of assets.

What is the difference between book value and equity?

Book value is the company’s total assets minus its liabilities and intangible assets. It can be greater than, less than, or equal to zero. Equity is the total value of all shares issued by a company and the value of all earnings that the company has retained. It can also be greater than, less than, or equal to zero.

What is the difference between book value per share and market value?

The reasoning for this is that book value per share represents the financial strength of a company based on its assets, an objective number, whereas market value per share represents the attractiveness of a company's shares in the marketplace, a subjective number.