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Margin of Safety Calculator

LAST UPDATE: September 1st, 2018

Calculator

What is Margin of Safety?

The margin of safety is a concept that shows how far above (or below) a company’s stock is trading compared with the company’s intrinsic value.

Formula

Margin of Safety = 1 – (Stock Current Price / Stock Intrinsic Value)

Example

A stock has a current price of $25 and intrinsic stock value of $30.

Margin of Safety = 1 – ($25 / $30) = 1 – 0.833 = 0.167

Therefore, this company has a margin of safety of 0.167, 0r 16.7%.

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