# Price to Book value Ratio

**Price to book ratio (PBV ratio or P/B ratio) expresses the relationship between the stock price and the book value of each share. This ratio used to compare a company's book value to its current market price. This ratio also gives some idea of whether an investor is paying too much for what would be left if the company went bankrupt immediately. The lower the PBV ratio, the better the value is. However, the value of the ratio varies across industries. A better benchmark is to compare with industry average. It is calculated as follows:**

**NEXT - Market Test Ratios: Price/Sales Ratio**

**Table of Contents****1) Market Test Ratios: Introduction2) Market Test Ratios: Earning per Share Ratio3) Market Test Ratios: P/E Ratio4) Market Test Ratios: Payout Ratio5) Market Test Ratios: Dividend Yield Ratio6) Market Test Ratios: Price/Cash flow Ratio7) Market Test Ratios: Price to book value Ratio8) Market Test Ratios: Price/Sales Ratio9) Market Test Ratios: Price/Earnings To Growth Ratio**