How many stocks are currently valued below their book value?
Using book values published by MSN Money, there are currently 40 stocks on the S&P 500 that have been discounted to these levels. Flip over to the Canadian side, which has fared relatively better than its American counterparts during the recent recession, and 11 are below this value. The average book value for all of the stocks analyzed was slightly over $18 per share which compares to the average market value of almost $40. This leaves us with a ratio of just over 2:1 of market value to book. Now this doesn’t mean a whole lot, other than the fact that it is lower than what you’d see in prosperous times, but it does provide indication about the faith that people are placing in the market as they avoid creating the next “bubble”.
