Book Value per Share (BVPS)
Shareholders' equity divided by diluted shares outstanding. The accounting book value of one share — a per-share liquidation-style floor for equity value.
When to use: Use as the denominator of P/B and as a baseline for the Graham Number. BVPS is also a starting point for "tangible" or "adjusted" book-value variants commonly used in financial-services analysis.
Formula
Variables
| Symbol | Name | Description | Unit |
|---|---|---|---|
| BVPS | Book Value per Share | Equity ÷ shares outstanding | $ |
| Equity | Shareholders' Equity | Book value of shareholders' equity | $ |
| Shares | Shares Outstanding | Diluted shares outstanding | integer |
Real-Life Examples
Example 1: Mid-Cap Bank
Total shareholders' equity is $3.5 billion. Diluted shares outstanding: 100 million.
Given
Step-by-Step
Book value per share is $35. A bank trading at $40 is at a 1.14× P/B; one trading at $30 would be at 0.86× — meaningfully below book and a potential value signal (or a credit-concern warning).
Frequently Asked Questions
Diluted, by convention — it includes the dilution effect of options, warrants, and convertible securities. Basic BVPS overstates per-share book value by ignoring potential dilution.
Tangible BVPS = (Equity − Goodwill − Intangibles) / Shares. Strips out asset categories that have no liquidation value, giving a more conservative book floor. Banks especially track this metric.
Buybacks above current BVPS (math reduces denominator faster than numerator), losses, special dividends in excess of earnings, or large goodwill writedowns. Conversely, BVPS rises with retained earnings and below-BVPS buybacks.