A phrase that is often referred to, in particular in the same discussion as the Price to Book value, is the Return on Equity. This video looks at that the return on equity is numerically - i.e. the Net Income or Earnings divided by the Book Value of the Equity, and why this is often linked to the value for the Price to Book.
It is a very good lessons but would you describe it on a white board?
thealireza1808 1 year ago
Really? I don't think he get more convoluted.
This guy should speak simple English and focus on the core issue.
ROE measures the efficiency of management at deploying equity capital.
ie: How much earnings a company can generate per $1 of equity capital.
60steiners 2 years ago
well said
z3219825 3 years ago