Which are the best stocks with PBV ratio below 5 year average in India right now?
As per Equitymaster's Stock Screener, here is a list of stocks with PBV ratio below 5 year average in India right now...
- #1 SEYA INDUSTRIES
- #2 PILANI INVESTMENT & IND.
- #3 PILANI INVESTMENT
- #4 CEREBRA INTE
- #5 HINDUSTAN MEDIA VENTURES
Generally, speaking, low PB stocks are considered to be undervalued stocks. And high PB stocks are said to be expensive.
Of course, there are other parameters you should take into account before forming a hard opinion on the stock valuation.
What is the price to book value ratio?
The Price to Book Value (P/B) ratio is a valuation ratio that is used to determine whether a stock is undervalued or overvalued.
It compares the company's stock price with its book value per share.
How is the PB ratio calculated?
The PB ratio is calculated by dividing the stock price by the company's book value per share.
PB Ratio = Stock Price/Book value per share
Watch this for a detailed explanation of the PB Ratio.
Is a low PB ratio good?
A low price-to-book ratio could indicate that a stock is undervalued. This is especially true if the stock's book value is less than one as it creates a "margin of safety" for investors.
However, a very low PB ratio can also be a sign of trouble at a company, so it should be used as part of a thorough stock analysis.
What is a good PB ratio?
As per the tenets of value investing, any value under 1 is considered a good value. However, investors often consider stocks with a PB ratio of under 3.