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Net Asset Value
Book value is the net asset value (NAV) of a company's stocks and bonds.
Finding the NAV involves subtracting the company's short- and long-term liabilities from its assets to find net assets. Then you'd divide the net assets by the number of shares of common stock, preferred stock, or bonds to get the NAV per share or per bond.
Book value is sometimes cited as a way of determining whether a company's assets cover its outstanding obligations and equity issues.
Further, some investors and analysts look at the price of a stock in relation to its book value, which is provided in the company's annual report, to help identify undervalued stocks. Other investors discount the relevance of this information.
book valuethe money amount of an ASSET as stated in a company's LEDGER accounts and BALANCE SHEET. FIXED ASSETS are often stated at NET BOOK VALUE (original cost less cumulative DEPRECIATION), while CURRENT ASSETS are stated at original cost or market value, whichever is the lower.
The value of an asset as reflected on the books and records of a company,taking into account the original book cost of acquisition and then deducting depreciation expenses charged over the years and adding capital expenditures.Book value rarely bears any relationship to the true value of assets.