Price to Tangible Book Value - PTBV

See: Tangible Book Value. That number goes in the denominator. (See: Book Value while you're at it, so you know what intangibles to subtract out) Then in the numerator? Well, price, duh.

So how do you make the numbers foot? Well, you'd take the total number of shares outstanding and get a TBV, or tangible book value per share number. Like...if TBV is $20 million and there are 40 million shares out, then the company has tangible book value per share of 50 cents.

So then...the price? Well, that'd probably be the price per share if the company was public (and most private companies that are large track the same.) If the company's stock is trading at 8 bucks, then the price to tangible book value is 8 divided by 50 cents of 16 times. What does that mean? Well, almost nothing, really. It's just an accounting term. It just means that the company has TBV of 50 cents, and it's worth 16 times that number.

Woot? Yeah, we don't know either. In theory, book value is the value of all the assets of the company, so if the business itself went awry, you'd sell everything and just liquidate whatever at book value. So 16 times that number is big...but it probably just means that the company doesn't have a ton of tangible book value assets in their coffers, so...it's just another data point along the accounting highway.