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Message:: [QUOTE="InfleXion, post: 1339999, member: 29012"]This is one way a particular brokerage (maybe it's an industry standard, I don't know) calculates intrinsic value of a company, but much of that value is based on capital which has no intrinsic value. It says "We refer to this price as the intrinsic value of the stock", but just because they use the word out of context doesn't make it true. It's a great method to calculate the true worth of a company, sure, but they are making a leap of faith in assuming that such value is intrinsic as well as a leap of faith that any intrinsic value of the company translates to intrinsic value of a stock. To put it differently, if you were to take your company with you 2000 years in the past or 2000 years in the future then the intrinsic value would be worth the assets you can bring with you. The cash would be worth the paper and the ink, same as the company title, or any paper stocks. Any electronic assets would be non-existent unless you had them on a thumb drive, and then it would only be worth the parts on that, collectibility notwithstanding, but face value would be nil. These things all have value today, but for it to be intrinsic it needs to be eternally constant, otherwise it is not by the nature of the thing but rather based on faith in it.[/QUOTE]