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

People who had a lot of familiarity with social media and digital imaging tools were more skeptical about the authenticity of the images and less likely to accept them at face value. — Mona Kasra, The Conversation, "Identifying a fake picture online is harder than you might think," 24 June 2019 Though the seats were in a section reserved for donors who had given at least a million dollars to the university, Wilcox said Pruitt paid just the face value of $130 for each ticket. — The Washington Post, NOLA.com, "EPA chief Scott Pruitt sought used Trump hotel mattress: aide," 4 June 2018 The university provided documentation showing that Mr. Pruitt paid face value for two tickets for three home games. — New York Times, "For Pruitt Aides, the Boss’s Personal Life Was Part of the Job," 15 June 2018 Sunday night, that site was selling seats on the field for as high as $1,980 — more than 10 times face value. — Timothy Finn, kansascity, "Billy Joel Kansas City concert tickets: Don't pay too much | The Kansas City Star," 22 Jan. 2018 Taken at face value, the plan would go a long way toward reducing America's carbon footprint. — David Grossman, Popular Mechanics, "New Green Deal, Explaind: What's Actually in the Alexandria Ocasio-Cortez Energy Plan?," 8 Feb. 2019 But opinions seemed to diverge on whether Trump's remarks should be taken on face value only, or in context of his greater campaign to vilify non-white immigrants. — Mari Uyehara, GQ, "What Trump Really Means When He Talks About Migrant Children, MS-13, and "Animals"," 30 May 2018 The deal is the latest sign of the collapsing distinction between the primary and secondary ticket markets—that is, when tickets are first sold for face value versus when they are resold by brokers or fans, often at a markup. — Anne Steele, WSJ, "Staples Center Owner Seeks to Take a Piece of StubHub’s Action," 14 Sep. 2018 But is there a business in reselling tickets for face value? — Dave Brooks, Billboard, "Is There Money in Ticket Trading? Some Startups See Dollar Signs in Fan Exchanges," 16 Feb. 2018

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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Last Updated

11 Jul 2019

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The first known use of face value was in 1851

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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