What does a price-to-book ratio of 1 signify? Option: "The market value and intrinsic value of the stock are aligned.", "The stock is highly volatile and risky.", "The company is about to go bankrupt.", "The company is experiencing rapid growth."

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What does a price-to-book ratio of 1 signify?

"The market value and intrinsic value of the stock are aligned."

"The stock is highly volatile and risky."

"The company is about to go bankrupt."

"The company is experiencing rapid growth."

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What does a high Price to Book Value (P/BV) ratio suggest?

The company has high sales

The company has low debt

The stock is undervalued

The stock is overvalued

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What does a high Price-to-Book (P/B) ratio suggest about a company's stock?

The stock is likely overvalued

The company has a high level of debt

The company has a low dividend yield

The stock is likely undervalued

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What does a high P/B ratio suggest about investor expectations?

Investors expect the company to incur losses

Investors expect the company's stock price to decline

Investors expect the company's book value to decrease

Investors expect the management to generate more value from assets

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Why is the P/B ratio considered more relevant for banks than the P/E ratio?

It helps understand the efficiency of fund utilization

It is based on the company's earnings

It indicates the bank's market share

It reflects the bank's profitability

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What does the P/E ratio tell an investor?

The amount of money to invest to earn Re.1 of the company's earnings

The efficiency of fund utilization

The company's book value per share

The bank's spread