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face value

noun

Definition of face value

1 : the value indicated on the face (as of a postage stamp or a stock certificate)
2 : the apparent value or significance if their remarks may be taken at face value

Examples of face value in a Sentence

We paid $100 for tickets that had a face value of $50.

Recent Examples on the Web

 Add the 4 percent or so that the bond’s owners have made in interest since it was issued, and people who bought the bond at face value in 2017 are up about 75 percent on their money. — Allan Sloan, Washington Post, "The buying frenzy over a 98-year Austrian bond," 2 Aug. 2019 Denver’s average high temperature is 89 degrees on Aug. 2, a number that might not come off as particularly significant at face value. — Chris Bianchi, The Denver Post, "Winter is coming: Starting today, Denver’s average high drops until December," 2 Aug. 2019 The other issue: Some of the tickets put on resale would have been purchased by real fans if sold at face value. — Dan Kopf, Quartzy, "The Live Nation scandal shows the concert industry needs to learn economics from Taylor Swift," 27 July 2019 The representative asked Live Nation to place 88,000 tickets for an upcoming tour on ticket-resale sites, bypassing outlets where they could be bought at face value. — The Economist, "How big stars maximise their take from tours," 25 July 2019 Taken at face value, there is much to admire in this approach to Big Tech, which goes beyond standard-issue conservative outbursts over the alleged censoring of Diamond & Silk and James O’Keefe. — Alexander Zaitchik, The New Republic, "Is Josh Hawley For Real?," 25 July 2019 At face value, those numbers do not match the perception of the stadium’s prejudice against power hitters. — Anthony Fenech, Detroit Free Press, "Time for Detroit Tigers to even Comerica Park's playing field for hitters," 24 July 2019 Bonnie Carlson At face value, Bonnie seems to be the member of the Monterey Five most likely to take the police's deal. — Ariana Romero, refinery29.com, "The Big Little Lies Finale Is Coming — Which Of The Monterey Five Will Spill The Lie?," 15 July 2019 There’s no reason not to take that at face value, despite the dismay the club felt when Neymar abandoned it. — Jonathan Wilson, SI.com, "The Domino Effect of Barcelona Signing Antoine Griezmann–and Its Impact on Neymar," 12 July 2019

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'face value.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

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First Known Use of face value

1851, in the meaning defined at sense 1

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More Definitions for face value

face value

noun

Financial Definition of face value

What It Is

Face value, also referred to as par value or nominal value, is the value shown on the face of a security certificate, including currency. The concept most commonly applies to stocks and bonds, so it is particularly important to bond and preferred stock investors.

How It Works

Face value is an often arbitrarily assigned amount used to calculate the accounting value of a company's stock for balance sheet purposes.

When it comes to bonds and preferred stock, however, face value represents the amount that must be repaid at maturity. Corporate bonds usually carry a $1,000 face value, municipal bonds usually carry a $5,000 face value, and government bonds usually carry a $10,000 face value, though these amounts can vary widely.

Let's assume Company XYZ decides to issue $1,000,000 in bonds to raise capital to help fund the construction of a new factory. If each bond had a face value of $1,000, the company would have to issue 1,000 bonds to meet its $1,000,000 goal.

This bond issue would also pay interest in an amount per bond that is impacted by the amount of the face value. For example, if the bonds paid 5%, it means they will pay interest amounting to 5% of the bond's face value each year. That would mean interest payments totaling $50 annually for a bond with a $1,000 face value.

Why It Matters

Face value is a crucial component of many bond and preferred stock calculations -- including interest payments, market values, discounts, premiums, and yields.

As shown in the example above, the interest on a bond is usually calculated as a percentage of face value. Additionally, bondholders often receive a percentage over the bond's face value as a redemption premium if the borrower decides to repay the debt before it is due (known as a callable bond, this is often done on a sliding scale based on when the bonds are redeemed).

It is important to note that when it comes to stocks, face value (or par value) generally has no relation to market price. Bond prices, however, are heavily influenced by their face value. Bonds are usually quoted as a percentage of face value. However, their prices can climb above (premium) or fall below (discount) their face value based on changes in interest rates and the financial health of the underlying issuer.

Source: Investing Answers

face value

noun

English Language Learners Definition of face value

: the value that is printed or shown on something (such as a coin or bill)

See the full definition for face value in the English Language Learners Dictionary

face value

noun

Legal Definition of face value

: the value indicated on the face of something (as a stock certificate)

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