Intrinsic Value Per Share Calculator


How Intrinsic Value per Share is Calculated

This calculator estimates a stock’s intrinsic value per share using the Discounted Cash Flow (DCF) method. It begins by projecting the company’s future Free Cash Flow (FCF) over a set number of years, applying your chosen annual growth rate. These future cash flows are then discounted back to present value using a discount rate, which represents your required rate of return or the company's cost of capital—essentially, the minimum return you expect for the investment.

After the forecast period, a terminal value is calculated to represent the company’s cash flow beyond the projection horizon. This value assumes the company continues growing at a steady terminal growth rate indefinitely. The terminal value is also discounted to present value. Finally, the sum of all discounted cash flows is divided by the total number of shares outstanding to estimate the intrinsic value per share.


Advertisement
Advertisement

Advertisement

Advertisement