How much is a share really worth?
There’s no one answer, but you can approach the question intelligently by employing the humble PE ratio and making a few assumptions.
How this calculator works:
Enter your assumptions for each scenario — including forecast earnings per share (EPS), the price-to-earnings (PE) multiple, time horizon, and discount rate. The calculator projects a future valuation for each case and then discounts it back to today’s dollars. Finally, it combines all three scenarios using your assigned weightings to give a weighted average valuation.
Scenario Valuation Tool
| Variable | Bear Case | Base Case | Bull Case |
|---|---|---|---|
| Forecast EPS 🛈 Expected earnings per share (in dollars) at end of period | $ |
$ |
$ |
| Forecast PE 🛈 Price-to-earnings multiple at end of period | |||
| Forecast period (years) 🛈 Years until you expect valuation to be realised | |||
| Discount rate (%) 🛈 Annual rate to discount future value to today | |||
| Intrinsic Value | $0.00 | $0.00 | $0.00 |
| Weighting (%) 🛈 Probability you assign to each scenario | |||
|---|---|---|---|
| Weighted Average | $0.00 | ||
🧠 Things to Keep in Mind
- Valuation is an estimate, not a fact. Even the most sophisticated models rely on assumptions and forecasts — which are ultimately just educated guesses.
- Garbage in, garbage out. The quality of your output depends entirely on the quality of your inputs. Unrealistic assumptions will lead to misleading results.
- The market doesn’t have to agree with you. Just because your model suggests a stock is undervalued doesn’t mean the market will reflect that view anytime soon — or ever.
- Sentiment and expectations matter. Prices are driven by what people believe will happen, not necessarily what should happen. That belief can shift suddenly and irrationally.
- Discounted valuations are sensitive. Small changes in discount rate, growth, or PE can have a big impact on your result. Always test a range of scenarios.
- Use this tool as a framework, not a crystal ball. It’s designed to guide your thinking and force clarity around assumptions — not deliver a definitive answer.
- A weighted average helps balance uncertainty. Using a blend of bear, base, and bull cases is a great way to avoid overconfidence in any one outcome.
- There’s no such thing as precision. A $9.37 valuation isn’t any more meaningful than “around $9–10”. Focus more on direction and drivers than decimal points.
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