In
stocks, the
market value of a company's
assets per
share. Asset value does not take into account the share price; one calculates the asset value by adding together the total value of the company's
tangible and
intangible assets and dividing by the
shares outstanding.
Fundamental analysts may use a company's asset value to determine whether it is
undervalued or
overvalued. A company with a share price below its asset value is considered undervalued and fundamental analysts may recommend
buying shares in that company. On the other hand, a company with a share price above the asset value is overvalued and fundamental analysts may recommend
selling it. See also:
Net asset value.