Valuation

Intrinsic Value

Definition

What is Intrinsic Value?

An estimate of an asset's underlying economic worth based on expected cash flows, assets, or earning power.

Example in practice

The analyst estimates intrinsic value above the current market price.

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The price at which an asset could trade in the market at a given time.

An estimate of an asset's appropriate value under specified assumptions or accounting standards.

The amount at which an asset or liability appears in financial statements.

Present value of expected cash inflows minus present value of expected cash outflows.

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