Iv Calculator
Calculate the intrinsic value of a stock using the Discounted Cash Flow (DCF) model.
Published by:
isCalculator Editorial Team
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How to use this tool?
Step 1: Enter the company's Earnings Per Share (EPS) in dollars (e.g., 5.00). This is the profit per share over the last 12 months.
Step 2: Input the expected annual Growth Rate as a percentage (e.g., 10 for 10%). This is how fast you expect EPS to grow each year.
Step 3: Enter your required Discount Rate as a percentage (e.g., 12 for 12%). This reflects the minimum return you'd accept for the investment risk.
Step 4: Set the number of Years to Project (e.g., 10). The calculator will sum the present value of earnings for each year.
Step 5: Click "Calculate Intrinsic Value". The result shows the total present value of all future earnings—this is the stock's estimated intrinsic value per share.
Tip: All inputs must be positive numbers. Years must be a whole number. The result updates instantly after clicking the button.
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Frequently Asked Questions
Intrinsic value is the perceived or calculated value of an asset, based on fundamental analysis. In this calculator, we use the Discounted Cash Flow (DCF) model to estimate the present value of future earnings.
The growth rate should be your estimate of the company's annual earnings growth rate over the projection period. You can use historical growth rates, analyst estimates, or your own analysis.
The discount rate reflects the riskiness of the investment. A common choice is the weighted average cost of capital (WACC) or a rate like 10-12% for stocks.
