Monday, 17 October 2011

Intrinsic Value Calculator and Spreadsheet Template

Intrinsic Value Calculator 

Value investors actively seek stocks of companies that they believe the market has 
undervalued.  They believe the market overreacts to good and bad news, resulting 
in stock price movements that do not correspond with the company's long-term 
fundamentals. The result is an opportunity for value investors to profit by buying 
when the price is deflated. (courtesy of

Want to estimate the value of a stock? Try this top-rated Intrinsic Value Calculator!

Simply enter your stock symbol and click "Submit" to get started.
Read more about Value Investing

Enter Stock Symbol and click Submit
Enter Stock Symbol  Terms of Use

STEP 1:  

Input values and click "Calculate Intrinsic Value"
Input or Adjust values:
Current EPS (TTM) :Where to find EPS(ttm)?
Estimated Growth Rate to use:%Where to find growth rate?
Future PE To use:View current PE  View historic PEs
Current Price $:Where to find current quote?
STEP 2:  

Review Results
Review Results
Estimated Intrinsic Value Price:$
Estimated Margin of Safety Value Price:$
5-Year Return on Investment Capital (ROIC):
(A strong business will have a 5-Year ROIC of 10% or greater)

Review Technical Chart
View Technical Chart for ; trade on momentum [MACD(17,8,9) and 10-day MA] 

Other useful research links:
View Key Statistics for 
View Historic Equity Growth (Book Value / Share) for 
View Historic EPS and Sales Growth for

How is the Estimated Intrinsic Value calculated?
The software determines an estimated growth rate based on the historic EPS and Equity growth rates. It then applies FV (future value) calculations to determine the expected EPS and stock price at some point in the future. It then reverses the calculation using a minimum acceptable rate of return (15%) to determine the intrinsic value in today’s dollars. The MOS price is half of that estimated intrinsic value price. Value investors
believe that risk can be minimized by only investing when the current price falls below the MOS price.

Click to Download this FREE!
Intrinsic Value Excel Spreadsheet Template

(or Right-Click and select 'Save-As')

Calculates the intrinsic value and MOS (margin of safety) for your stocks

Additional notes:

If you’re worried about earnings and earnings growth consistency and want to factor it in somehow, you may want to attenuate growth rates or bump up the discount rate to account for uncertainty.

The keep-it-simple-safe (KISS) approach used by most value investors, including Warren Buffett, is to discount at a relatively high rate, usually higher than the growth rate. 

Buffett uses 15 percent as a discount, or “hurdle” rate – investments must clear a 15 percent “hurdle” before clearing the bar.  The 15 percent hurdle incorporates a lot of risk, especially in today’s environment of relatively low interest rate and inflation. Conservative value investors usually use discount rates in the 10 to 15 percent range.

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