How To CALCULATE INTRINSIC VALUE of a STOCK?

How To CALCULATE INTRINSIC VALUE of a STOCK? in Hindi

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Warren Buffett says the three most important words in investing is "Margin of Safety". But most people don't know how to calculate the intrinsic or the actual value of a stock (shares), or even a fair value so how are they going to use the margin of safety?

In this video, I help to find out the real or the actual (intrinsic value) of the stock (share) with the discounted cash flow approach and then I explain it in detail using the Price to Earnings ratio (PE ratio) in simple language using the Golden Rule of Valuation: The Value of any asset is the present value of all the expected future cash flows.

Since the stock (share) market is an auction market, so the stocks are not sold at fair price but are put on sale in the auction and every time a stock becomes popular, it becomes extremely overvalued, and hence too risky for beginner investors. This is why, many famous and rich value investors such as Warren Buffett, Charlie Munger, Benjamin Graham, Rakesh Jhunjhunwala and other mutual fund managers do intrinsic value calculation before they look at the stock price for buying.

We can find the price of stock easily by doing a simple google search but the intrinsic value is something you need to find yourself by doing some basic calculations. The reality is, finding intrinsic value is easy but you just need to understand some basic concepts, do the analysis and your fundamental research and get a good understanding of compounding, discounting, and cash flows in a business.

However, as discussed in the video, the most important task is to identify and understand the quality of stock (business) only then, do you get the confidence to invest more in an undervalued stock and become a true value investor to make money and get rich from stocks.

Timestamps:
00:00 Warren Buffett on Most Important Thing in Investing
00:08 What is Margin of Safety in Value Investing?
01:48 Calculating Intrinsic Value of a Business
03:25 Intrinsic Value Simple Formula
04:52 Understanding DCF (Discount Cashflow Method of Valuation)
07:18 Golden Rule of Valuation
07:52 Understanding Price to Earnings (PE Ratio)
10:16 Tickertape (Sponsor for the video)
10:38 Important Lesson in Investing
11:56 Outro

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[Value_Pilgrim]

What a wonderful video!
I am doing my CFA and can safely say that you are doing a wonderful public service. If people understand and do only this set of calculations they will not lose money! And in the stock market if you don't lose money, you will definitely make money and become wealthy.

Thanks for the wonderful job!

[mojojojo]

I am so glad i found this
i can't believe how you made it so easy to understand.
Thank you so much bro!!

[soccertalker]

I watch this video 5 times to get each and every line because every line is full of knowledge😍

[jesbensommichael]

Been watching, listening, and paying attention to all of predictions and forecasts since early Covid. He hasn't disappointed yet 👌

[abhishekdev]

Bhai aur aise videos banao. Itna kisi youtuber se nhi sikha jitna tumhare 3-4 videos ne sikha diya. Awesome work bro.👌
Dil se thanks

[shivammishra]

I feel proud ...when i click on this video...thumbnail is not only click bet got more than a class room in short❤️❤️ we need persons like you on youtube🙏

[stargazer]

Audio and visual presentation is very important in finance...you have nailed it bro .
A combination of simple language and in depth analysis broken down into simple words makes your videos popular....keep up the good work :)

[thesane_rider]

I recently started with my investment and proper financial journey and you seem to just explain it to me very easily. keep growing.

[PareshGujarati]

The first video in complete YouTube world, which gave me the complete idea of intrinsic value.

[shyampatra]

Greatly excited for the next video❤️❤️

[realgamer]

you explain concepts very clearly and we learn a lot from watching your videos thank u from the bottom of my heart

[sachinchauhan]

Your channel is still umderrated bruh u r too good headsdown to u GURUJI..!!😊😊

[pritishbhatti]

It's such an amazing video
.. you cleared alot of concepts in a single video ... Thankyou so much for such an amazing video ! 🤟🏻

[piyushninave]

Thanks a lot for this video mate, I have been trying hard to understand how do they calculate intrinsic value of any stock since long time, finally understood the basics of it. You are great . . 🙏😊

[ketanborse]

I was searching for simple one to understand and here it is 🔥🔥🔥🔥🔥 keep it on bro....👍🏼👍🏼👍🏼✌🏼valuable content 🔥🔥

[darshanpatel]

Thnx for this bro... keeping it up bro.. Great searies or course.... I ever watched on stock market..🗝️💸

[Black-tflp]

You are providing value bro.You deserve 1 million subscribers in this year bro.❤️

[pkkkkkkvv]

I'm lucky that I got your channel, keep making these educational videos on topics you promised in previous videos..

[Sciencewithjc]

I have watched more than 70 videos of stock market in last few weeks, and this is the best video out of them. 👍👍👍👍👍

[syedimtiazabbashussain]

Yes. But also consider Net worth of company after revaluation of assets at the time of negotiation of buying and selling a business as per above example.

Past performance help to understand company but we should never consider future earning in buying a business due to many factors.