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profitability-market

by io.finance-tools.market

calculate_pb_ratio

Read-onlyIdempotent

Calculate the price-to-book (P/B) ratio: share price divided by book value per share — how much investors pay relative to accounting net asset value. Formula: P/B = Share Price / Book Value Per Share. WHEN TO USE: Use for valuing asset-heavy or financial companies where book value is a meaningful anchor; P/B < 1 can indicate undervaluation or low returns on assets. WHEN NOT TO USE: Do NOT use for asset-light businesses (intangibles make book value meaningless) or where book value is negative. BEHAVIOUR: pure deterministic calculation — no side effects, no network or storage access; idempotent and non-destructive; identical inputs always produce identical outputs. Division by zero or non-finite inputs returns an explicit error instead of a number. RETURNS: JSON object { pb_ratio: number (e.g. 1.4 = 1.4x), inputs }. PARAMETERS: share_price (required): Current share price, e.g. 45.00. Must be > 0. book_value_per_share (required): Book value per share (shareholders’ equity / shares), e.g. 32.00. Must be > 0 for a meaningful ratio.

Input Schema

TableJSON Schema
NameRequiredDescriptionDefault
share_priceYesCurrent share price, e.g. 45.00. Must be > 0.
book_value_per_shareYesBook value per share (shareholders’ equity / shares), e.g. 32.00. Must be > 0 for a meaningful ratio.

TDQS

A4.5/5.0
Behavior5/5

Does the description disclose side effects, auth requirements, rate limits, or destructive behavior?

Beyond the readOnly/idempotent/destructive annotations, the description discloses pure deterministic calculation, no side effects, no network/storage access, identical outputs for identical inputs, and explicit error behavior on division by zero or non-finite inputs. This is rich behavioral context.

Agents need to know what a tool does to the world before calling it. Descriptions should go beyond structured annotations to explain consequences.

Conciseness5/5

Is the description appropriately sized, front-loaded, and free of redundancy?

The description is well-organized with clear labeled sections: formula, when to use, when not to use, behavior, returns, and parameters. Every section earns its place and the most important information is front-loaded.

Shorter descriptions cost fewer tokens and are easier for agents to parse. Every sentence should earn its place.

Completeness5/5

Given the tool's complexity, does the description cover enough for an agent to succeed on first attempt?

Despite having no output schema, the description explains the return shape as a JSON object with pb_ratio and inputs. It also covers error conditions, parameter constraints, and use context, making it complete for an agent to invoke correctly.

Complex tools with many parameters or behaviors need more documentation. Simple tools need less. This dimension scales expectations accordingly.

Parameters3/5

Does the description clarify parameter syntax, constraints, interactions, or defaults beyond what the schema provides?

Schema coverage is 100% and the parameter text in the description largely duplicates the schema descriptions. The formula and financial rationale add context, but individual parameter meanings are already fully documented in the schema, so no significant extra semantic value is added.

Input schemas describe structure but not intent. Descriptions should explain non-obvious parameter relationships and valid value ranges.

Purpose5/5

Does the description clearly state what the tool does and how it differs from similar tools?

The description states a specific verb and resource: 'Calculate the price-to-book (P/B) ratio' with the exact formula. It is clearly differentiated from the sibling ratio calculators by naming its precise financial definition and output.

Agents choose between tools based on descriptions. A clear purpose with a specific verb and resource helps agents select the right tool.

Usage Guidelines4/5

Does the description explain when to use this tool, when not to, or what alternatives exist?

Explicit WHEN TO USE and WHEN NOT TO USE sections give strong context: use for asset-heavy or financial companies, avoid for asset-light businesses or negative book value. It does not name alternative sibling tools directly, but the conditions are clear enough to guide selection.

Agents often have multiple tools that could apply. Explicit usage guidance like "use X instead of Y when Z" prevents misuse.

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TDQS

A4.7/5.0
Disambiguation5/5

Each tool calculates a distinct financial metric with its own formula, inputs, and output. Even similarly named return-on-capital tools (ROA, ROE, ROCE, ROIC) are clearly differentiated by their denominators and described use cases.

Naming Consistency5/5

All 12 tools follow the exact same calculate_<metric_name> snake_case pattern. The verb is consistent and metric names map directly to the formulas, making the set highly predictable.

Tool Count5/5

Twelve tools is a well-scoped size for a financial ratio calculator covering profitability, return, valuation, and dividend metrics. Each tool addresses a distinct calculation and none feel redundant or unnecessary.

Completeness4/5

The tool surface covers core profitability margins, return ratios, EPS, dividend yield, payout ratio, P/E, and P/B. Minor gaps exist such as price-to-sales, EV/EBITDA, or EBITDA margin, but the primary domain of profitability and market valuation is well represented.

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