How to Calculate Intrinsic Value

Video Transcript

"Hi, my name is Jeannine Smith, and this is Spence Cottam. We're with Account Team here in Salt Lake City, and we help companies, mostly small businesses, get on track with their finances. We help them to get caught up so they can get their taxes going, and to get hopefully loans for their business. Today, I would like to talk to you about intrinsic value. The difference between intrinsic value and maybe a given value that some body places on an item is intrinsic value is what some body can easily turn that, that product or that good over, and make it, make that money back. Say if, if you had a car that you love more than anything, you may not be willing to sell it for, you know, for less than what ever is that given amount, but some one who's loaning money on that car will only loan money on the intrinsic value, what they could if, if something were to go wrong, what they could get back for that easily, say in an auction, and that would be what they'd loan, for the intrinsic value. Another great example would be someone with some baseball cards. They think it's not worse, not worth less than a thousand dollars, but maybe in the rest of the world, they're only trading for about three hundred dollars. That, the intrinsic value of those baseball cards is three hundred dollars."