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Price to book

I'm curious whether there is a simple way to determine the "right" Price-to-book ratio for a firm, beyond simply comping said firm to its peers or to its own history. Would simply comparing ROE to cost of equity - i.e. making those two #s a ratio and then finding the ratio factor - be a c... Read More

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by Guest 1.

added 11 years ago

Re: Price to book

Sounds like you are trying to find an "intrinsic" price-to-book ratio of some sort? At first glance, we're not sure why this is relevant. P/B is a market multiple; so there is no "intrinsic" or "correct" answer, but rather, what investors (the market) are willing to pay... Read More

by WST Expert 1.

added 11 years ago

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