market value

1. General: Highest estimated price that a buyer would pay and a seller would accept for an item in an open and competitive market.

2. Accounting: Asset's or inventory's replacement cost of an item arrived at by deducting estimated carrying, delivery, and selling costs from its estimated selling price. See also fair market value (FMV).

We feel noble intentions should be checked periodically against results. We test the wisdom of retaining earnings by assessing whether retention, over time, delivers shareholders at least $1 of market value for each $1 retained. To date, this test has been met. We will continue to apply it on a five-year rolling basis. As our net worth grows, it is more difficult to use retained earnings wisely. We continue to pass the test, but the challenges of doing so have grown more difficult. If we reach the point that we can't create extra value by retaining earnings, we will pay them out and let our shareholders deploy the funds.