Showing posts with label Investing. Show all posts
Showing posts with label Investing. Show all posts

What is Book Value Per Share & Book Value formula

What is Book Value Per Share

What is Book Value Per Share

book value per Share refers to the total worth amount of a company if it liquidated its assets & paid back its liabilities.

means shareholders will receive that much amount(book value) per share if a company is liquidated.

Book value indicates how strong a company is. if the book value of a share is high it means that the company's economic position is very strong.

we can also say that the Book value of a share shows us the real value of the company.

How to Calculate Book Value Per Share

Let's assume there is a company called "ABC" which market capital is 1 crore rupees (or your country currency).

General Reserve of the company is 1 crore and the total no of share is 10 lacs.

Book Value formula


Market Capital + Reserve / Total no of share

1 crore / 10 lacs = 20 Rupees

in this case, the book value of the company will be 20 Rupees.

you can measure the company performances year by year with the help of book value.

hope now you can calculate the Book value of the company's share.

What is EPS/Earning Per Share

in this article, we will discuss what is EPS or how Earnings Per Share of the company calculated.



Generally, the EPS shows how a company is performing if the earning per share is high.

it means the company is doing great business and earning profits.

based on the EPS you can calculate the price to earnings ratio or PE ratio.


How EPS is Calculated

Let's assume there is a company called "ABC". which is generated the Net profit of 20 crores Rupees(or your country currency).

the total share of the company is 1 crore.

so when you will calculate the earnings of the company per share.

divide the
Net profit / Total no. of shares = EPS

20 crore / 1 crore = 20

after dividing you will get the EPS or Earning per share of the company.

in the case of company "ABC" EPS is 20 Rupees.

now you calculated the EPS of the company "ABC" so whenever you will calculate the PE ratio of the company, you can use the EPS.

similarly, there is a company "XYZ" and it has the Net profit of 15 lac rupees.

no of shares of the company is 3 lac.

the EPS of the company will be:

15 lakhs  / 3 lakhs = 5

now I think you are able to calculate EPS and knows well how To calculate the Earning of the company based on the per share.

When To Start Investing- Right Time To Invest

in this article, I will share with you When to Start Investing in life.
The Right Time To Start Investing


Warren Buffett the great investor of the world started investing at the age of 11 and he says I was too late.

so if you are thinking to start investing then start early.


When to Start Investing

anybody can start investing whether men or women.

who save and invest will be more prosperous in the future than people who are not saving and investing.

the best time to start investing is when you are young.

people who are starting investing in their 50s or 60s also not too late.

they lost their compounding power of 50 or 60 years.

The Right Time to Start Investing

start small think big, start investing in your early age or school days or as early as possible.
  • when you are living with your parents.
  • when you have no children.
  • when you no need pay house rent.
but the main thing is many people don't know how to start investing.

save whatever money you can on a regular basis, whether it's ten rupees(or your country currency) a month, one hundred, or one thousand rupees a month.

and invest it.

money is a great friend when you put it to work, it generates passive income in your pocket without doing any work.

How To Start Investing In Stock Market

in this article, I will share with you How to Start Investing in the Stock market.


How To Start Investing In Stock Market


people think "Investing is Risky" but also a group who thinks "Investing is a Fun".

investing is Risky when you don't have financial knowledge or guidance.

Many people due to the lack of financial knowledge keep their money on saving account or fixed deposits.

I already shared about what is the right time to start investing.

so they lose the value of their money in long-term when inflation increases.

that's why financially educated people called them-


"Savers are Losers".

but anyhow you have to save money for your future life.

if you can save more money then definitely manage it

if you save more money you can buy more shares in the company means more profit when the company will grow.

Advantages of Investing

if you picked company wisely then in future your share will be worth a lot more.

you can earn the passive income no need to do work hard, your money will work for you.


power of compounding will make you wealthy for a long time.

or you can become the owner of a company by purchasing the shares.

I shared about passive income ideas for those who don't want to work for others.

How To Start Investing

you can start investing your money in many ways-

  • you can buy bonds.
  • you can fix your money for a long time (Fixed Deposit).
  • you can invest in mutual funds.
but it will return less on your investment.

How To Start Investing In Stock Market

before starting the investment you should know what is stock market and it works.

without getting knowledge about the stock market, it will be Risky for you.

to pick the best stock you need to know how to do fundamental analysis.

start reading the books based on the investing/business/Startups/Entrepreneurship.

it will help you

  1. what factors can make growth on the stocks?
  2. how management runs businesses.
  3. how they generate profit.
  4. how they increase sales.

if you have an idea how to do fundamental analysis then chances are very high to get the maximum return based on your investment amount.


Disadvantages of Investing

in the life, the risk is everywhere and you can run away from it but you need to handle or manage the risk if you want to be successful.

your experience or knowledge will help you to handle all risk of investing.

the "Fear of Market Crash" is big disadvantages of investing.

the Market is Uncertain nobody knows when the market will crash, market crash depends on many factors.

"Fear of Losing Money" depends upon your knowledge or experience, how much information you have about a particular company that much profit you can make.

conclusion

investing is important because it is the key to financial freedom, start small and think big.

failure is the part of the success, learn how to handle the risk factor.