• Book value per share (BVPS) is the ratio of a firm’s total equity to the number of shares outstanding.

  • The book value of equity per share actually indicates the value of the firm’s net assets (total assets - total liabilities) on a share-by-share basis.
  • When a stock is undervalued, it will have a higher book value relative to its current share price in the market.
  • BVPS is used mainly by equity investors to evaluate the value of a company’s shares.