Intrinsic value is the value received before tax from immediate exercise of an option; the amount by which the option is In the money. The word “intrinsic” is defined as “belonging to the real nature of a thing; not dependent on external circumstances.

Warren Buffett Intrinsic Value Formula (?)

Warren Buffett uses a margin of safety and a government bond yield as a discount rate when he calculates the intrinsic value of a company.

What is intrinsic value of a stock?

If you have every felt that you can make money in the stock market, if only you knew when a stock was available cheap or at a discount to its fair value, you need yo know about intrinsic value.

Intrinsic or fair value of a stock is its present day value computed on the basis of predicted future earnings. Intrinsic value is calculated using the discounted cash flow technique. Benjamin Graham, considered the founder of fundamental analysis, first put forth the concept of intrinsic value.

Estimated future earnings of a stock depend on many factors, including, but not limited to, the current financial situation, the macroeconomic and operating environment and the ability of the management to do well both in good and bad times


Est. Intrinsic Value