P/B
Business & Finance abbreviation · Stock Market & Investing
| Stands for | Price-to-book ratio |
|---|---|
| Categories | Business & Finance |
P/B stands for Price-to-book ratio, a stock market & investing abbreviation.
Valuation ratio comparing a company's share price with its book value per share, or market capitalization with shareholders' equity. A P/B below 1 can mean the market values the company at less than its net assets.
Example: European banks traded at a P/B of about 0.7, well below their US peers.
Usage notes
P/B is most useful for asset-heavy companies such as banks and insurers, whose balance sheets reflect market values reasonably well. For technology firms with mostly intangible assets, it says little. Value investors following Benjamin Graham have long screened for low price-to-book stocks.
Related abbreviations
More stock market & investing abbreviations
- NSE – National Stock Exchange of India
- NYMEX – New York Mercantile Exchange
- NYSE – New York Stock Exchange
- OI – Open interest
- OTC – Over-the-counter
- OTM – Out of the money
- P/E – Price-to-earnings ratio
- P/S – Price-to-sales ratio
- PDT – Pattern day trader
- PEG – Price/earnings-to-growth ratio
- PFOF – Payment for order flow
- PT – Price target