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Berkshire Hathaway Intrinsic Value Calculator
Two-stage residual income model · formula shown below · educational, not investment advice
Inputs
Defaults are an example starting point — replace with figures from the latest 10-K and your own assumptions.
Year-by-year
| Year | BVPS | EPS | Excess | PV |
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How this calculator works
Berkshire's intrinsic value is usually framed as book value plus the discounted stream of earnings in excess of a required return on that book — the residual income model. It matches how Buffett describes owner earnings: what the business produces above what capital could earn elsewhere.
Stage one projects ten years of excess earnings at your growth rate. The terminal stage capitalizes excess earnings beyond year ten at the terminal growth rate. Every intermediate number is in the table above — change an input and everything recomputes.
Book value vs intrinsic value
Book value is the accounting floor: what the balance sheet says the company is worth today. Intrinsic value is the discounted future cash the machine can produce. Berkshire has historically traded above book value because its earnings power exceeds its book — the multiple you pay for that excess is exactly the judgment this tool helps you structure. For the deeper framework, see our Berkshire fundamentals desk guide and the five-panel scorecard breakdown.
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How do you calculate Berkshire Hathaway intrinsic value?
A common approach is a two-stage residual income model: start from book value per share, project the excess of earnings over a required return on book, discount it, and add a terminal value. This calculator implements that method and shows every intermediate number.
Is BRK B undervalued right now?
No honest tool answers that without showing its work. Run the numbers yourself: enter current book value per share and EPS from the latest 10-K, choose your growth and discount assumptions, and compare the output to the market price. The gap is your margin-of-safety question, not a verdict.
What is the difference between book value and intrinsic value for Berkshire?
Book value is an accounting floor — what the balance sheet says. Intrinsic value is the discounted future cash the business can produce. Berkshire trades above book value precisely because its earnings power exceeds its book; the multiple you pay for that excess is what this calculator helps you reason about.
What is the intrinsic value of Berkshire Hathaway?
There is no single official number — intrinsic value is an estimate that depends on your inputs: book value per share, earnings, growth in years 1-10 and beyond, and your discount rate. That is exactly why this calculator exists: change the assumptions, watch the intrinsic value and margin-of-safety readouts move, and own the estimate instead of borrowing someone else's. Buffett himself has repeatedly said a precise figure is impossible; a defensible range is the honest goal.
How does Warren Buffett calculate intrinsic value?
Buffett has described it as the discounted value of the cash that can be taken out of a business over its remaining life. In practice for Berkshire-style analysis that means residual income on book value: start with book value per share, project earnings growth in two stages, discount at your required rate, and compare the result with the market price. The calculator on this page implements that two-stage residual income method with free inputs.
Educational tool. Outputs depend entirely on your assumptions. Not investment advice — see our full disclaimer. Today's index levels are on the stock market today page.