• Holder of equity shares in a firm.
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| ||Referenced Terms|
| ||Asset/equity ratio: The ratio of total assets to Stockholder equity.|
| ||Book value per share: The amount per share of common stock that would be received if all of the firm's assets were sold for their exact book (accounting) value and the proceeds remaining after paying all liabilities (and preferred shares) were divided among the common shareholders.The ratio of Stockholder equity to the average number of common shares. Book value per share should not be thought of as an indicator of economic worth, since it reflects accounting valuation (and not necessarily market valuation).See Book Value.|
| ||Debt/equity ratio: Indicator of financial leverage. Compares assets provided by creditors to assets provided by shareholders. Determined by dividing long-term debt by common Stockholder equity.|
| ||Financial risk: The risk that the cash flow of an issuer will not be adequate to meet its financial obligations. Also referred to as the additional risk that a firm's Stockholder bears when the firm utilizes debt and equity.The risk to the firm of being unable to cover required financial obligations (interest, lease payments, preferred share dividends).|
| ||Long term debt/capitalization: Indicator of financial leverage. Shows long-term debt as a proportion of the capital available. Determined by dividing long-term debt by the sum of long-term debt, preferred stock and common Stockholder equity.|
| ||Related Terms|
| ||Stockholder equity|