scorecardresearchWhat is the price to book ratio: How is it useful for investors?

What is the price to book ratio: How is it useful for investors?

Updated: 14 Dec 2021, 05:14 PM IST
TL;DR.
P/B ratio generally indicates how much will the investor get if it goes bankrupt and is used to determine if a stock is undervalued or overvalued by the market. Let’s understand how it helps investors.
Price-to-book ratio is the amount an investor will get (per share) if the company goes bankrupt or is liquidated.

Price-to-book ratio is the amount an investor will get (per share) if the company goes bankrupt or is liquidated.