The price-to-book ratio divides share price by book value per share — assets minus liabilities, per share. It's most useful for asset-heavy businesses like banks, insurers, and REITs, where book value closely tracks intrinsic worth.
The formula
Price per ShareBook Value per Share
= P/B Ratio
Why it matters
- —Below 1.0× means the market values the company at less than its net assets — sometimes a bargain, sometimes a warning.
- —Less useful for asset-light businesses (software, services) where most value is intangible and off the balance sheet.
- —A classic input for value-investing screens alongside P/E.
How to read it
| < 1.0× | Trading below net asset value |
| 1.0×–3.0× | Typical for most industries |
| > 3.0× | Market values intangibles or growth well above book |
Lowest P/B in our coverage
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