Book Value Per Share AnalysisBook Value per Share (B/S) is can be calculated by subtracting liabilities from assets, and then dividing it by the total number of currently outstanding shares. It indicates the level of safety associated with each common share after removing effects of liabilities. In other words a shareholder can use this ratio to see how much he or she can sell the stake in the company in the event of liquidation.
Book Value Per Share Over Time Pattern
About Book Value Per ShareThe naive approach to look at Book Value per Share is to compare it to current stock price. If Book Value per Share is higher than the currently traded stock price, the company can be considered undervalued. However, investors must be aware that conventional calculation of Book Value does not include intangible assets such as good will, intellectual property, trademarks or brands and may not be an appropriate measure for many firms.
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Chevron Book Value Per Share Assessment
In accordance with recently published financial statements the book value per share of Chevron Corporation is about 79 times. This is much higher than that of the Energy sector, and significantly higher than that of Oil & Gas Integrated industry, The Book Value Per Share for all stocks is over 1000% lower than the firm.