Book 'em, Danno: In tough times, check book value
— -- Q: Is there a website that provides the price-to-book-value ratio for publicly traded stocks and a way to screen for stocks based on it?
A: During uncertain times for stocks, many investors like to go by the book.
Book value is an accounting measure used to estimate what a company is worth based on the sum of its assets. The book value of an asset owned by an industrial company, for instance, begins on the books as the price paid for the asset. Then each year, the value would decline, based on depreciation.
Investors looking for beat-up bargain stocks often pay close attention to book value. These "value" investors figure a stock might be a screaming buy if it's trading close to or less than book value. It would be as if a home's price fell below the value of the brick, lumber, glass and granite that went into building the home.
Book value also becomes important to investors in bad economic times. Investors looking for some sort of security blanket pay attention to book value as a kind of baseline or worse-case scenario value of the company and its stock.
Now, as to your question. The answer is yes. There are sources for book value information. If you're looking for the book value on a stock, you can start with USATODAY.com's Money section.
Start at money.usatoday.com, on the left side of the page, scroll down below the Dow chart and look for the Get a Quote box, where you can enter a stock name or ticker symbol. Enter the stock ticker and click the Go button. A summary page will come up. Next, click on the "Profile" link just above the chart. Scroll down and you'll find the stock's book value in the section called Per Share Data.
If you'd like to screen stocks that meet certain book value thresholds, try MSN Money at moneycentral.msn.com. The site has a powerful screening tool, which includes book value as one of its searchable items. This previous Ask Matt column steps you through using MSN Money to build a screen. While this screen creates a list of stocks in an industry, the same basic steps apply to building a screen of stocks with a certain book value.
