In the example from a moment ago, a company has $1,000,000 in equity and 1,000,000 shares outstanding.
The first thing one might do is compare the price/BVPS number to the historic trend.
Companies report their total assets and total liabilities on their balance sheets on a quarterly and annual basis.
Why this is so important to investors is because it provides a concrete knowledge of a company’s value if all its assets were to be liquidated and all liabilities settled.
