Book Value

A company net worth as recorded on its balance sheet.

Book value equals total assets minus total liabilities. It represents what shareholders would theoretically receive if the company were liquidated. The Price-to-Book ratio compares market cap to book value. Technology companies often trade at high P/B multiples because their intangible assets are not fully captured on the balance sheet.

The bank traded below its book value, meaning the market priced it under its net worth on paper.