Fundamental Indicator

 As with any fundamental indicator, book value must be considered in conjunction with other indicators.

It is also more meaningful when used to analyze stocks in certain industries compared to others. As an example, the stock of a rapidly growing company could trade well above book value and still represent a good buy in some industries.

Cash Flow vs. Debt
Cash flow is the amount of money that is moving in and out of a business. Operating cash flow is revenue less operating expenses, including adjustments to net income. Cash flow is a good indicator of a company's financial health because it is more difficult for companies to manipulate than earnings. As such, some investors prefer it as an analytical tool.

Debt is the total amount that is owed by a company, including bonds and outstanding loans. While debt can finance growth during times of prosperity, it can also become a burden if a company is having financial difficulties. A company's debt obligations should be manageable in relation to its cash flow.

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