Updated from 7:59 a.m. EDTThe book value of a stock, in simple terms, is what a shareholder would get per share if all the assets of the company were sold off, all the debts were paid off, and the remaining cash were distributed among all the shareholders. The ratio that is used to measure this is the price-to-book ratio. The lower the number, the better. It means that you are buying the company's net assets at a lower price. If the price-to-book is less than 1, it means that the shares are selling for less than the net worth of the company. Here are some stocks with a price-to-book of less than 1 and market caps of more than $500 million, including Rite Aid ( RAD - Get Report) and Blockbuster ( BBI). For the rest of the story and some great bargains for less than $3 a share, please click here.
A note from James Altucher:Every weekend I send an email to Jim Cramer and several hedge fund managers about the most interesting portfolios posted on Stockpickr that week. Usually those portfolios not only list stocks according to atheme but also offer significant analysis as to why the stocks are cheap.Here are some examples: