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Market to Book Ratio Calculator

Formula

The formula to calculate the Market to Book Ratio (MBVR) is:

$MBVR = \left( \frac{MV}{BV} \right) \times 100$

Where:

$MBVR$ is the Market to Book Ratio (%).
$MV$ is the Total Market Value ($).
$BV$ is the Total Book Value ($).

What is Market to Book Ratio?

The market to book ratio is a financial metric used to compare a company's market value to its book value. It is calculated by dividing the total market value by the total book value and then multiplying by 100 to express it as a percentage. This ratio helps investors understand how much they are paying for a company's assets compared to its book value.

Example Calculation

Consider an example where:

Total Market Value (MV): $500,000
Total Book Value (BV): $250,000

Using the formula to calculate the Market to Book Ratio:

$MBVR = \left( \frac{500000}{250000} \right) \times 100 = 200\%$

This means that the market to book ratio for this example is 200%.