I was just wondering which would be better for a company. For instance if the book value per share was like $7, and the fair market value was $6... what is better? I'm confused.
2006-12-07 06:18:42 · 4 answers · asked by MeShell 2 in Business & Finance ➔ Investing
Market value is alway the significant price since this is what you pay to get the share.
If the market price is lower than the book value it means that the company is not performing well for some reason which has to be figured out. Either they have a lot of cash hoarde from the past performance and low key performance for now or even the company management might be slackening living on their enriched cash tranche and forfeiting present and future. These sort of companies are either taken over or sometimes they go under or the stock holders vote out the management for infusing new blood into management.
2006-12-07 07:18:15 · answer #1 · answered by Mathew C 5 · 0⤊ 0⤋
Book value doesn't really mean anything. That's what the stocks are valued at in the company's records, but market value is what you can buy and sell them for.
2006-12-07 06:27:46 · answer #2 · answered by Knowledge 3 · 0⤊ 0⤋
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2006-12-07 06:46:41 · answer #3 · answered by Anonymous · 0⤊ 0⤋
EXCUSE ME, you will basically "not use that"!!! it is tax evasion and/or fraud. IRS demands which you checklist all income gained, alongside with prizes. and you gets a 1099 from the corporation which has been sent additionally to the IRS, so they are going to renowned. If this is in undemanding terms $six hundred or $1200 extra income, and counting on your tax bracket, not a good number of efficient, say 15-20%. you're able to resell the indle and the books, yet once you're making extra effective than the FMV (your foundation), it is likewise reportable income.
2016-12-11 04:12:18 · answer #4 · answered by Anonymous · 0⤊ 0⤋