what is intrinsic value 
intrinsic value is a measure of what an asset is worth this measure is arrived at by means of an objective calculation or complex financial model intrinsic value is different from the current market price of an asset however comparing it to that current price can give investors an idea of whether the asset is undervalued or overvalued financial analysis uses cash flow to determine the intrinsic or underlying value of a company or stock in options pricing intrinsic value is the difference between the strike price of the option and the current market price of the underlying asset investopedia theresa chiechiunderstanding intrinsic valuethere is no universal standard for calculating the intrinsic value of a company or stock financial analysts attempt to determine an asset s intrinsic value by using fundamental and technical analyses to gauge its actual financial performance while they may build valuation models using qualitative quantitative and perceptual business factors the metric often used in calculations for intrinsic value is discounted cash flows typically investors try to use both qualitative and quantitative factors to measure the intrinsic value of a company but investors should keep in mind that the result is still only an estimate qualitative factors are such things as business model governance and target markets items specific to the what the business does quantitative factors refer to financial performance and include financial ratios and financial statement analysis perceptual factors refer to investors perceptions of the relative worth of an asset they re largely accounted for by means of technical analysis generally speaking intrinsic value can be considered to be how much the business is worth as determined by selling off the whole business and its assets 