Calculate book value per share, total common stockholder’s equity, or common shares when you enter any two of the three values and get the missing figure.
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Book Value Per Share Formula
The primary formula for book value per share is:
BVPS = Equity / Shares
- BVPS = book value per share, in dollars per share
- Equity = total common stockholder’s equity, in dollars
- Shares = number of common shares
The calculator can also rearrange the formula to solve for any missing value:
Equity = BVPS * Shares
Shares = Equity / BVPS
- To calculate book value per share: enter total common stockholder’s equity and number of common shares.
- To calculate total common stockholder’s equity: enter book value per share and number of common shares.
- To calculate number of common shares: enter total common stockholder’s equity and book value per share.
Book Value Per Share Inputs and Interpretation
| Input | Where it usually comes from | Notes |
|---|---|---|
| Total common stockholder’s equity | Balance sheet, stockholders’ equity section | Use common equity, not total assets or total liabilities. |
| Number of common shares | Financial statements, share count disclosures, or company filings | Use common shares. Do not include preferred shares unless the analysis specifically requires it. |
| Book value per share | Calculated from equity divided by common shares | Represents accounting value per common share, not the market price. |
| Result pattern | What it may suggest | Important limitation |
|---|---|---|
| Higher BVPS | More accounting equity supports each common share. | A high BVPS does not automatically mean the stock is undervalued. |
| Lower BVPS | Less accounting equity supports each common share. | Some companies have low book value because their value comes from intangible assets or future earnings. |
| Negative BVPS | Common stockholder’s equity is negative. | This can indicate financial weakness, but you should review the full balance sheet and income statement. |
Example Problems
Example 1: Calculate book value per share
A company has total common stockholder’s equity of $5,000,000 and 1,000,000 common shares.
BVPS = 5000000 / 1000000
BVPS = 5.00
The book value per share is $5.00.
Example 2: Calculate total common stockholder’s equity
A company has a book value per share of $12.50 and 800,000 common shares.
Equity = 12.50 * 800000
Equity = 10000000
The total common stockholder’s equity is $10,000,000.
FAQ
Is book value per share the same as stock price?
No. Book value per share is based on accounting equity from the balance sheet. Stock price is the market price investors are currently willing to pay for one share. A stock can trade above or below its book value per share.
Should preferred stock be included in book value per share?
For common book value per share, use common stockholder’s equity. If total equity includes preferred equity, subtract preferred equity before calculating BVPS for common shareholders.
Why can book value per share be negative?
Book value per share can be negative when common stockholder’s equity is negative. This means liabilities and other claims exceed the company’s recorded assets available to common shareholders.
