Tangible book value

Tangible book value strips goodwill and other intangible assets out of book value, leaving only the accounting net worth attributable to assets with a genuine physical or realisable value, cash, inventory, equipment, and similar holdings.

It's generally used as a more conservative measure than plain book value, especially for companies that have grown through acquisitions, since those deals typically add large amounts of goodwill to the balance sheet that may not hold real value in a distressed sale.

Investors who focus on tangible book value are usually being deliberately cautious, treating a company's intangible assets as something to discount rather than rely on.