Publicly Listed Companies are required by law to file various business reports and financial statements on a quarterly and annual basis. These filings are available for the public to view and inspect and they provide detailed information about the business and financial health of the company. With the Fairvalue-Calculator, we extract, calculate and analyze key financials from these annual reports and generate our own statistics and analyses which can be utilized by all investors irrespective of their experience or knowledge to aid them in their investment journey. Use the free manual calculator and subscribe to our premium membership which allows you access to various premium tools and functions which will aid you in identifying great stocks with high intrinsic value.
With our Value Strategy, we present you stocks whose intrinsic value exceeds their current share price. In this tutorial, you will learn about our value strategy and how to find undervalued stocks using our fair value calculator in an easy to understand manner.
Annual reports of publicly listed companies remain the cornerstone of all securities analysis. Fund managers and security analysts alike refer to these reports, not only for key financials like revenue growth, profitability, debt, margins, asset and liabilities etc. but also for information on business operations, future outlook and the management’s thought process.
Using various financial models, analysts and fund managers determine the fair value of the stock and accordingly make buy or sell decisions choosing to buy those that are undervalued or inexpensive. A fee is charged by them to the investors either directly for access to reports or indirectly via fund fees or broker fees.
With our tools, you as an investor can do all of these analyses in an easy and simplified manner. You can use our calculators and our premium database to identify great stocks and build your portfolio yourself, thus saving you expensive fees and eliminating reliance on someone else to manage your portfolio.
As an investor, one would want nothing more than to gain control of one’s portfolio and thus their journey towards financial independence. Using our range of free manual and extended calculators as well as our premium calculators and database, one can curate a list of stocks that are undervalued and add them to their investment portfolio for superior performance.
While the free manual calculator is geared towards the do it yourself approach, our premium tool provides you all of its benefits and more without our members having to put in any effort. As a premium member, not only do we prepare custom analyses using specially developed artificial intelligence which extracts information from annual reports to prepare the analyses but also provide unique information regarding the stock which is only available for access to a premium member.
Our Premium Tool automatically calculates the fair price of the stock using our proprietary algorithm that uses up to 15 key figures to determine the true value of the share. Multiple methods of valuation are also employed and a consensus fair value figure is provided which allows investors to identify the fair value of the company and thus invest in those which have a higher fair value than current market price.
Here is an example:
One can see the various valuation methods used to arrive at the fair value and a consensus can be built by the investor as well to determine undervaluation of the stock. Accuracy of the analyses can be seen by the number of stars which is determined by the availability of required financial figures in the company’s annual report. Additionally we evaluate all important key figures in the Total Value Score automatically.
The relative strength of the share shows how well the share has performed in comparison to all other shares in the database.
Join our membership and enjoy our Tools! The Portfolio Manager will help you to create a great stock portfolio full of undervalued stocks.
On the subpage of each stock further key figures which are explained individually by clicking on the respective key figure are available.
Don't worry, you don't need to know all of these metrics by now. Because our artificial intelligence uses this information to build an easily understandable, coherent analysis text that everyone understands and colors the corresponding key figure green if it is to be assessed positively and red if it is to be assessed badly. In the course of the application you will get to know the key figures and you will get used to interpreting this information. Again in the example of Foot Locker:
Our artificial intelligence uses numerous financial metrics extracted from the annual reports to build a coherent and easy to understand analyses that saves you as an investor the headache of dealing with all those numbers yourself. What’s more, the numbers are colored basis their relative performance with good colored in green and bad colored in red so that an all green stock is to be preferred and an all red stock to be avoided.
With our industry comparison feature, one can compare their stock with the industry average to determine if the stock is a market leader or not and general target figures are provided as well for easier comparison.
The Fair Value Database contains information of shares of 38.100 publicly listed companies across the globe. Our Fair Value Calculator shows around 624 stocks in USA that have a higher fair value than their current price. Similarly, there are 57 stocks in Germany with their fair values being higher than current market prices. One can find and analyse these stocks using the Stock Screener option available to our Premium Members. The screener consists of various filters to aid in screening. The stock search option is available for free for users who wish to see if their stock is present in the database before subscribing to our Premium Membership.
With the Premium Tools in our membership, you can use all tools for stock analysis unlimited! In the introduction to the Premium Dashboard you can see which tools are available. The premium access costs only a monthly fee of 7.90 Euro. This makes it the most comprehensive and cheapest database for fair values that we know of. You can cancel at any time via your PayPal account. No minimum commitment - no rip off! After paying, you will receive your access data directly by email and you can set up your personal premium dashboard immediately.
We at fairvalue-calculator.com have analyzed several independent studies, conducted thorough research and performed extensive backtests to prove our strategy. Our strategy outperformed stock markets over the past 14 years, returning excessive annual returns of 9-15% over and above market returns. These returns came with reduced volatility and thus reduced risk which flies contrary to the widely accepted wisdom that increased returns come only with increased risk. Our fair value calculator bucks this trend by allowing you access to stocks that will help generate additional returns without taking on additional risk. One can read about our backtesting and studies here.
Using the fair value calculator is no guarantee of secure profits! Investing in stocks can lead to financial loss!
Did you know that only 5% of all managed funds outperform the overall market? 95% of managed funds fail to beat a portfolio consisting of random selection of stocks selected by monkeys. A study by Cass Business School in London demonstrated the outperformance of a random portfolio of stocks selected by monkeys throwing darts at a financial newspaper page containing a list of stock names.
Actively managed funds have high costs that are not backed by the manager’s investment skills leading to poor performance compounded by these costs. It is advisable for the investor to avoid this cost drag on their portfolio by taking matters into their own hands and gaining control of their portfolio.
By choosing to subscribe to our fair value calculator, all investors need is a broker who will allow them to place their orders. Our premium membership allows you full freedom to construct a portfolio of quality stocks as you see fit. It also offers a portfolio manager that will assist in the creation of a balanced and diversified stock portfolio.
The best part about us is that it does not require any special knowledge or education to construct a portfolio or begin investing. We do it all for you in the portfolio manager and the list generated from it can be transferred directly to your brokerage account for execution. We also monitor the portfolio and intimate our premium members about stocks that have seen a drop in fair value and which warrant exclusion from the portfolio.
Premium Membership gives you access to all the premium tools to determine the true value of stocks and the composition of a fair value stock portfolio. These following tools are available within the premium search & database:
With the Portfolio Manager, you can assemble your personal stock portfolio full of Fair Value shares. The Portfolio Manager helps you to put together your stocks portfolio.
In the colored bars under the Watchlist, you can see what type of stock you should add to create a balanced low-risk portfolio.
For the stocks In your Portfolio Manager you will also receive alert emails: If a stock no longer meets the requirements of the Fair Value Strategy an email will be automatically sent to your Inbox. For every meaningful and necessary action that is necessary in this portfolio, you will also receive an email. You can place as many stocks as you want in the sample portfolio or watchlist.
To meet the requirements of the Portfolio Manager, you can use the categorical search for Fair Value stocks. Of course, you can also use this search without the use of Portfolio Manager.
Simply select the country of origin of the stock and select the market capitalization of the company.
Low caps are rather smaller companies, mid-caps medium-sized companies and high caps the largest companies in the selected country of origin.
You now have the opportunity to add the stock to your portfolio or to visit the stock and read more fundamental key figures.
In the result list you will find only stocks that have a higher fair value (intrinsic value) than they currently cost.
These lists are kept up-to-date, just as the stocks in your Portfolio Manager are constantly being updated.
In addition, you can see the percentage difference to the fair value and the performance that the stock has made while in your Portfolio Manager.
There are currently thousands of undervalued cheap stocks in our database that you can view with a premium membership.
In the search you can already look up without a premium account if the stock you are interested in is in our database. If you have a premium account, you can use this search to search for a stock and see the fair value and fundamental metrics:
The idea of investing in undervalued stocks, ie stocks with a higher true value than the current market price, is not new. Probably the most well-known representative of this investment philosophy is probably Warren Buffet.
As co-founder of the Value approach, Warren Buffet managed to accumulate an incredible fortune over the course of his life, beating the market by an average of 15% a year.
As a beginner you often have an incorrect perception about how the stock market works. What must be understood is that institutional investors actually have no advantage over private investors.
We have the feeling that people who trust their bank to invest their money often think, "They have specialists for that" or "they know a lot more than me".
However, this is not quite correct, as any information your bank has can also easily be retrieved from the internet.
But not only that, big institutional investors have two more crucial issues:
Only the glossy Flyer conveys that this is done in your interest. Only you can act 100% in your own interest. Because whether you win or lose your bank probably does not matter, because the commissions and expenses ceded them no matter how their depot develops.
In addition, a fund manager can not simply go for millions on a new stock. With the huge amounts of money the fund has to move, it is as damaging as the Titanic when it tried to dodge the iceberg.
By contrast, as a private investor, you are literally sitting in a speedboat and can get out of one position in seconds and immediately switch to another. It can often take months for a fund manager to stock up on the desired number of shares. There are simply not enough stocks, and during the acquisition of the shares, the fund drives itself up the buying price.
A rather difficult undertaking if you ask me - as if the fees you pay for it are not bad enough?
The following example is a classically wrong approach for a beginner to take:
No matter which stocks are in there and how revolutionary the system may seem. The question is not what stocks will be invested or what system will be used to select these stocks, but what are the fees that the advisor, in whatever form, wishes to have for parking your money.
A 5% initial charge, an annual management fee of 2.5%, transaction costs of 0.5%, and hidden costs can undermine the return. Total costs of more than 6% are independent of performance on the agenda. In addition, 90% of fund managers perform worse than the overall market.
This means that if you invest purely in the DAX without selecting individual stocks, you are already working better than 90% of German fund managers.
For example, this could easily be done with an ETF. All in all, you can expect that after a year of investing in a mutual fund through your house bank, you will most likely not make any money even in times of rising stock markets, due to expenses and the inability of the big funds to move. To prove this, I will now select a randomly chosen fund of 3 major banks in Germany and compare their 3-year performance with the DAX. But since I do not feel like receiving threatening letters from lawyers, I will not name the names, in this point you have to trust me. So I call these funds 1-3.
Let's start the games:
The DAX has had a performance of 27.5% over the last 3 years. This performance could easily have been achieved with an ETF and generated a return of 27%. How would the fund managers have performed in those three years?
To illustrate we have blindly compared for the performance of funds from a financial service website for 'stock only funds'. To do this we blindly selected the 1st, the 5th and 10th fund in the list and posted the fund's annual performance here. None of the three funds beat the market (here the DAX). Try it for yourself and compare the equity fund returns with the indices in each country or market!
In addition other fund costs such as initial charge of 5% are not included yet! Actually unbelievable ..
We also carried out a further experiment by searching Google for the "best stock fund currently" click on the first Google entry and look at the 3 year performance. Unbelievable .. A list of 65 funds appears and none of the 65 was even able to generate a return of 27% in 3 years. With 13 million investors in Germany, approximately 10 million invest in funds and only 3 million select individual shares. Why?
Note on ETFs: ETFs are passively managed stock baskets that are launched once and then no longer changed. That's why ETFs cost just 0.5% a year and you can use it to portray pretty much every index in the world, even baskets from individual industries can be purchased. This is called passive stock funds, so here no fund manager buys or sells stocks.
If you're now convinced that you'd better take stock investing into your own hands, then you should use this website and the Fair Value Calculator - your chances are not bad that you'll be successful in the stock market.
Here we would like to cite a few facts that legitimize the use of the fair value strategy. As already mentioned, we did backtesting and live testing on the Fairvalue method, which strongly supports the performance of our method. A live test was launched on 30/03/2016, and the compiled portfolio created according to the fair value method recommended here on this site has been able to deliver a higher return than the overall market. After already 1 year! The Dow Jones performance was also below the fair value portfolio during this period.
This is my personal opinion. Dr. Peter Klein, BA
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* Payment method of the membership fee is Paypal. By clicking on the button "Buy now access to premium tools" you will be redirected to Paypal. As a result, you can make the payment. With the completion of the payment you pay the monthly fee of 7.90,- Euro. You can cancel this fee anytime on Paypal by clicking on the payment and subsequently canceling the subscription. (Only with the monthly subscription you will receive email alerts if fair values in your watchlist change or an action in your portfolio is necessary.) The access is still valid for the current month even if you instantly cancel it. By purchasing Premium Tools, you will be able to view the Fair Value of Shares and other details. You do not really buy stocks, you buy the analysis of the stock.
Disclaimers: fairvalue-calculator.com is not operated by a broker, a dealer, or a registered investment adviser. Under no circumstances does any information posted on fairvalue-calculator.com represent a recommendation to buy or sell a security. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The experts may buy and sell securities before and after any particular article and report and information herein is published, with respect to the securities discussed in any article and report posted herein. In no event shall fairvalue-calculator.com be liable to any member, guest or third party for any damages of any kind arising out of the use of any content or other material published or available on fairvalue-calculator.com, or relating to the use of, or inability to use, fairvalue-calculator.com or any content, including, without limitation, any investment losses, lost profits, lost opportunity, special, incidental, indirect, consequential or punitive damages. Past performance is a poor indicator of future performance. The information on this site, and in its related newsletters, is not intended to be, nor does it constitute, investment advice or recommendations. The information on this site is in no way guaranteed for completeness, accuracy or in any other way. With the Use of the Portfolio Manager you don´t actually buy stocks with real money. You just get the Information of how a stock portfolio could be compiled. To follow the instructions on this side is no guarantee for success on the stock market. Stock investments are risky and can cause financial damage or lead to money losses.