To find the par value of a stock, look at the company’s corporate charter, the face of a stock certificate, or the shareholders’ equity section of its SEC filings; to find the par value of a bond, look at the face of the bond itself, where the issuer states the amount it will repay at maturity. For stocks, if the filing shows a total dollar amount but no per-share figure, divide the common stock dollar amount by the number of shares issued. For bonds, the par value is almost always $1,000 unless the issuer says otherwise.
Finding Stock Par Value in the Corporate Charter
Every corporation’s articles of incorporation (sometimes called a corporate charter) set out the original capital structure, including the number of authorized shares and the par value assigned to each class of stock. These documents are filed with the secretary of state in the corporation’s home state, and most states make them available as public records. If you know where a company is incorporated, you can usually pull the filing directly from the state’s website.
Physical stock certificates, where they still exist, print the par value on the face of the document. You will see a small figure such as $0.01 or $0.001. Digital brokerage records have largely replaced paper certificates, but the underlying disclosure is the same, and your broker’s statements or the transfer agent’s records reflect the same number.
Finding Stock Par Value in SEC Filings
For a publicly traded company, the fastest route is the SEC’s EDGAR database, which is free to search.1U.S. Securities and Exchange Commission. About EDGAR Federal law requires companies with registered securities to file annual reports on Form 10-K and quarterly reports on Form 10-Q.2Office of the Law Revision Counsel. 15 USC 78m – Periodical and Other Reports
Inside either filing, go to the balance sheet and read down to the shareholders’ equity section. Federal regulations require companies to disclose, for each class of stock, the par or stated value along with the number of shares authorized and the number issued or outstanding.3eCFR. 17 CFR 210.5-02 – Balance Sheets A typical line reads something like “Common Stock, $0.01 par value, 500,000,000 shares authorized, 200,000,000 shares issued.” The $0.01 figure is what you are looking for. If the balance sheet is condensed, the notes to the financial statements carry the full breakdown.
Calculating Par Value From a Balance Sheet
Sometimes a filing states the total dollar amount of common stock without spelling out the per-share par value in an obvious way. The math is straightforward:
Par Value per Share = Total Common Stock รท Number of Shares Issued
Pull two numbers from the shareholders’ equity section: the dollar amount on the line labeled “Common Stock” or “Capital Stock,” and the number of shares issued. A company reporting $10,000 of common stock and 1,000,000 shares issued has a par value of $0.01 per share. The result is almost always a fraction of a dollar, because most companies set par as low as possible. The figure should match what appears in the articles of incorporation, and it stays constant regardless of market price. Shares that trade for $150 can still carry a par value of a penny.
Use Shares Issued, Not Shares Outstanding
Companies report both figures, and they often differ. Shares issued is the total count the company has ever distributed to investors. Shares outstanding is that number minus any shares the company has bought back and holds as treasury stock. For the par value calculation, use shares issued. Treasury stock transactions do not change the par value that was recorded when the shares were first sold, and the common stock line on the balance sheet reflects the issued figure. If a filing shows 1,200,000 shares issued and 1,180,000 outstanding, divide by 1,200,000.
Do Not Divide Total Shareholders’ Equity
Right below the common stock line, most balance sheets show “Additional Paid-In Capital,” or APIC. That represents everything shareholders paid above par when the company issued the stock. If a company sold 1,000,000 shares at $10 each with a par value of $0.01, only $10,000 lands in the common stock line; the remaining $9,990,000 sits in APIC. Divide the common stock line alone by shares issued. Dividing total shareholders’ equity, which also includes APIC and retained earnings, produces a number that has nothing to do with par value.
Finding Bond Par Value
Bond par value works differently. When you buy a bond, the par value (also called face value) is the amount the issuer promises to pay you at maturity. Most corporate and government bonds carry a par value of $1,000. That number also drives the interest payments: multiply the par value by the coupon rate, and you get the annual interest. A $1,000 bond with a 5% coupon pays $50 per year.
Bonds rarely trade at exactly par on the secondary market. When the coupon rate is higher than prevailing yields, the bond trades at a premium; when the coupon is lower, it trades at a discount; when the two match, the bond trades at par.4TreasuryDirect. Understanding Pricing and Interest Rates Whatever you paid on the open market, you still receive the full par value at maturity, assuming the issuer does not default. That is why par matters more for bonds than for stocks: it is the actual dollar amount coming back to you.
When a Stock Has No Par Value
Not every company assigns a par value. The model code many states base their corporate laws on eliminated the concept decades ago, and most states now allow no-par shares. When a company issues no-par stock, the entire amount investors paid goes into a single capital account rather than splitting between a par value line and APIC.
If you cannot find par value in a filing, the company may simply have issued no-par shares. The disclosure will say “no par value” where the par figure would normally appear. In that case there is nothing to calculate. A board of directors can assign a “stated value” for internal accounting, which functions similarly on the books but does not carry the same legal significance.
Why the Number You Find Is Usually Small
Historically, issuing shares below par value exposed a corporation to liability for the difference, the old concept of “watered stock.” Setting par at a penny, a fraction of a penny, or zero (through no-par shares) eliminates that risk. That is why the par value you find on a modern balance sheet is almost always a trivial amount, and why the market price of the stock has no relationship to it. For a bondholder, the par value on the face of the bond is the real number that governs interest and repayment. For a stockholder, the par value in a 10-K is mostly a legal formality that still has to be disclosed.