P/B — price to book
What it measures¶
P/B is the price investors pay for each unit of a company's book value — its equity on the balance sheet, what would be left for the owners if every asset were sold at its recorded value and every debt repaid. It is the market capitalisation (share price × number of shares) divided by the equity. A P/B of 3 means investors pay three times what the accounts say the owners' stake is worth.
Why it is on the page¶
It compares the market's view of a company with the accountants'. It means most for companies whose assets are mostly physical or financial and recorded near their value; it means least for companies whose real assets — software, brands, know-how — never appear on the balance sheet, which the Fundamentals page says on the row. It is one of the four multiples of the Workspace's Valuation strip.
Thresholds, their source and the population they were fitted on¶
P/B is described, never scored:
| Reference | What it shows | Source |
|---|---|---|
| own five-year band | above its 90th percentile, within, or below its 10th percentile — the band of the P/B at the company's last five fiscal year-ends | the company's own stored history; at least three year-ends |
| sector | above, within or below the middle half of similar companies — within 10% of their median where only a median is published | Aswath Damodaran's January industry tables |
| 1.5 times | Benjamin Graham's ceiling for a cautious investor | Graham, The Intelligent Investor |
| 22.5 | Graham's ceiling for P/E (price to earnings) multiplied by P/B | the same |
- Fitted on: Graham's lines come from his experience of mid-twentieth-century US industrial companies; untested.
- Evidence grade: folklore (Graham's lines); practitioner convention (sector medians).
A worked example¶
Apple, on the data stored on 25 October 2026: a P/B of 68.8, above its own band (43.0 to 58.6 between the 10th and 90th percentiles of four year-ends, middle 47.3). Apple has bought back so many of its own shares that its book equity is small; that, more than investors' enthusiasm, is what makes the multiple so high.
Celestica, as the Fundamentals page showed it on 9 August 2026: 20.39.
What “No verdict” means here¶
P/B never carries a verdict word. The row reads not applicable when the equity is zero or negative — a company whose debts exceed its recorded assets has no book value to divide by — and insufficient data when the equity or the share count is not stored.
What the verdict is and is not¶
Above its band says investors pay more for each unit of book value than they did at most recent year-ends. It is not a judgement of whether the price is right, not a forecast, and not an instruction to trade the shares. Buybacks, large write-downs and acquisitions all move the book value without any change in the business.