The price-to-book (PB) ratio is a measure of the relative value that the market places on a share of stock. We have estimated an empirical equation of two stages that explain about 62% of the variation in annual PB levels for the S&P 500 companies from the year 2000 to 2009. We explored the market's ability to anticipate changes in performance and found that the market price appears to reflect anticipatory information not present in the model value. This paper both advances understanding of PB 's determinants and provides a tool for managers who wish to enhance their firm's PB.