P/B Ratio: When Book Value Reveals Stock Bargains
The S&P 500 now trades at 5.63x book value — a fresh all-time high as of April 20, 2026, and the twelfth consecutive month above the old 2021 peak. The previous record of 5.39x sat there for just four months before being taken out. Book value per share for the index — $1,270.32 as of September 2025 — has risen steadily, but nowhere near fast enough to justify what investors keep paying for each dollar of net assets. Inside that headline number the dispersion is brutal. Citigroup trades at roughly 1.1x book. Apple trades at 43.4x. Information technology as a sector sits at 13.4x; energy at 1.9x. Both ends of the range are correct, and neither tells you which stock to buy. That paradox is where the price-to-book ratio earns its keep — not as a screener for cheap stocks, but as a diagnostic for where book value still reflects economic reality. With the Fed set to decide on rates on April 29 and CPI running at 3.3% YoY, the question of what you are actually paying for each dollar of net assets matters again. This guide walks through the mechanics, maps where P/B signals mispricing, and gives you the specific decision rules the best value investors actually use.