Our response:
Book value is an accounting term for a company’s net worth according to its financial statements. It represents what assets are left on its financial statements after debts are paid.
It also may be referred to as shareholders’ equity which is the value left for shareholder claims on a company’s assets but in most cases, a company’s book value may not represent its market value and should not be used as a substitute for a company’s worth.
Learn more about how to evaluate companies when buying stock including both financial and non-financial factors to consider.