Intrinsic value
Intrinsic value is what an investor believes a company's true value is.
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Expanded Definition
Value investors compare a company's intrinsic value to its market value to calculate a margin of safety.
Over the years, there have been many definitions of intrinsic value. John Burr Williams, author of The Theory of Investment Value, defined it as the present value of future cash flows. Benjamin Graham defined it as "that value which is justified by the facts". Warren Buffett has tended to use Williams's definition. John Maynard Keynes looked at intrinsic value as the prospective yield or return on investment.
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