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Book Value

Book value is the amount that would be left for common shareholders if all the tangible and intangible assets of a company could be liquidated and all the long and short-term debt, taxes, and preferred shareholders were paid. Tangible assets include the physical plant, inventories and money the company is owed, while intangible assets are the value of patents or brand names (often known as "goodwill").

Value Line calculates the book value per share for every company, and also indicates in a footnote how much of a company's book value is based on intangibles. Conservative investors may want to deduct these amounts when they are analyzing the financial strength of a company.

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