Book value per share is a company’s total shareholders’ equity divided by its number of shares outstanding, representing the accounting net asset value attributable to each share if the company were liquidated at its stated balance sheet values.
For example, a company with RM400 million in total shareholders’ equity and 200 million shares outstanding has a book value per share of RM2.00 — that’s the net asset value the balance sheet attributes to each individual share.
Book value per share is mainly used as the denominator in the price-to-book ratio, which compares it against the market price to see whether a stock is trading above or below its stated net asset value.