intrinsic value ... $39 , page-10

"Does everyone just assume that the numbers they come up with are plus/minus 50%?

50% is equivalent to a toss of the

I know about eight intrinsic value equations and they are all very simple.


However they only work if you have the right input and that is not easy.

Ben Graham used the following calculation

E(2r + 8.5) x 4.4/Y

let's assume 5% growth in earnings (unreasonable) and a long term bond yield of 5%



[$2.58 (10 + 8.5)) x 4.4/5 = 323.53}]/5 = $42

how about zero growth and the company breaks even

$2.58 x 8.5 x 4.4 = $19.30

If the company doesn't make a profit, you'd have to use asset values
eg $12.14