Formula for calculating intrinsic value of stock

2022-05-15 0 By

Stock intrinsic value formula: the intrinsic value of a stock = earnings per share + net assets per share + return on net assets + operating cash flow per share.The stock price in the stock market is determined by the intrinsic value of the stock. When the market enters the adjustment period, the market capital is too tight, and the stock price is generally lower than the intrinsic value of the stock. When the market is in the rising period, the market capital is abundant, and the stock price is generally higher than its intrinsic value.1. First of all, the theoretical value of the stock is very familiar to everyone, and most people talk about the theoretical value of the stock every day, but the rise and fall of the stock in most cases is determined by its virtual value.In other words, the price of a stock is determined by virtual value at a critical time.The same stock, held by different people, has different virtual value.2. Secondly, after the value of the stock is determined by the theoretical value orientation, the specific price is determined by the intangible assets of the holder.But the resulting real value creates new value in circulation.That’s the liquid value.The stock is in buying and selling process, because ceaseless have new holder to appear, general circumstance, the conversion of common holder is very limited to its value influence, affect stock price really is the change of main holder.The value of the shares is determined by the turnover rate of ordinary investors in the case of unchanged principal holders.If you can calculate the intrinsic value of a stock, multiply the intrinsic value of the stock by 70% to get a reasonable purchase price for the stock.A stock can be bought when its market price is less than or equal to its fair purchase price.When the market price of a stock is close to or equal to its intrinsic value, sell that stock (some say it’s easy, but it is).