What is Intrinsic Value?
Intrinsic value is the estimated true worth of a stock based on fundamental analysis — typically derived from DCF models or asset-based valuations.
Formula
Intrinsic Value = Sum of (Future Cash Flows ÷ (1 + Discount Rate)^n)
How to Interpret
If intrinsic value > market price, the stock may be undervalued. The gap between them is the margin of safety.
Typical Ranges
No fixed range — compare to current market price. Seek 25%+ margin of safety.