What is identified by the Market-to-Book ratio?

The Market-to-Book ratio is a financial metric that compares the market value of a company's equity to its book value. Specifically, it is calculated by dividing the stock price (market value per share) by the book value per share (the value of a company's assets minus its liabilities, divided by the number of outstanding shares). This ratio provides insight into how investors value the company compared to its actual worth according to its financial statements.

A higher Market-to-Book ratio indicates that investors are willing to pay a premium for the stock based on their expectations for future growth and profitability, while a lower ratio may suggest that the stock is undervalued or that the company is facing challenges.

In contrast, the other options pertain to different financial metrics that do not reflect the relationship between market value and book value. For instance, total assets minus total liabilities represents the company's equity value, while net income per share focuses on profitability, and the debt-to-equity ratio assesses financial leverage, none of which specifically conveys the Market-to-Book ratio's insights into valuation comparisons.