A ratio used to find the value of a company by comparing the book value of a firm to its market value. Book value is calculated by looking at the firm's historical cost or accounting value. Market value is determined in the stock market through its market capitalization.

Formula:

Most investors are more familiar with P/B or Price-to-book. This is just the inverted value.

We use Book-To-Market in our stock screener as it makes sure that companies with a negative value don't show up at the top of the list. We include it in the scorecard as P/B is presented alongside the P/E, P/S and P/CF ratios.