Value any stock in 30 seconds with the three methods analysts actually use — DCF, dividend discount, and P/E multiples. No spreadsheets, no formulas to remember.
Not investment advice. This calculator is an educational tool. Outputs depend entirely on the assumptions you enter — treat them as a starting point for your own research, not a buy/sell signal.
How this stock valuation calculator works
Every method answers the same question — what is this business actually worth? — from a different angle. Here's the math behind each tab, in plain English.
1. Discounted Cash Flow (DCF)
A company is worth the sum of all the cash it will generate in the future, discounted back to today because money later is worth less than money now. We project free cash flow for 5 years at your growth rate, then assume it grows forever at the terminal rate (the Gordon growth terminal value), and discount everything at your discount rate:
For companies that pay steady dividends, the stock is worth the discounted stream of future dividends: Value = D1 ÷ (r − g), where D1 is next year's dividend, r your required return and g the dividend growth rate. It's simple but sensitive — small changes in r or g swing the result a lot.
3. P/E Multiple vs. industry benchmark
The fastest sanity check: fair value = EPS × the P/E ratio that's normal for the company's industry. A software firm at 30x earnings can be cheap while a bank at 30x is almost certainly expensive — context is everything. That's why we anchor it to industry benchmarks rather than the market average.
Interpreting the result
The calculator compares intrinsic value to the current price and shows a margin of safety. A common approach: look for intrinsic value at least 20–30% above the market price before getting interested — that buffer protects you when your assumptions turn out too optimistic. If three methods land in the same zone, your estimate is sturdier than any single model.
Pick a method that fits the company: DCF for cash-generative businesses, DDM for reliable dividend payers, P/E multiples for a quick cross-check. Enter the inputs above and the calculator does the discounting for you.
What are the three methods of stock valuation?
Absolute valuation (DCF, DDM), relative valuation (multiples like P/E or EV/EBITDA), and asset-based valuation (book value). Professionals usually run at least two and compare.
What is a good P/E ratio by industry?
There is no single "good" number — software trades at 25–40x while banks trade at 8–12x. Always compare within the same industry, using benchmarks like the table above.
Why does my DCF value change so much with small input tweaks?
DCF is assumption-driven: the terminal value alone often makes up 60–80% of the total. That's normal — the discipline is in justifying your growth and discount rates, not in finding a magic number.