Stock Valuation Tool
Know what a stock is worth before you buy, sell, or sell an option.
Valuation is the foundation of every decision Wall St Yardie supports. Whether you are setting a buy price, choosing a covered call strike, or sizing a LEAPS position, it all starts with knowing what the business is worth.
Value a Stock in the AppWhat Does Stock Valuation Actually Mean?
Valuation is the process of estimating what a business is intrinsically worth, independent of its current market price.
A stock trading at $80 might be worth $60 (overvalued) or $120 (undervalued). The market price tells you what people are willing to pay today. Valuation tells you what the business should be worth based on its earnings power, growth, and risk. The gap between the two is where investing opportunities live.
Earnings-based
P/E ratio, earnings yield, and owner earnings models estimate value based on what the business earns.
Cash flow-based
Discounted cash flow (DCF) analysis projects future free cash flows and discounts them to today's value.
Asset-based
Book value and tangible assets set a floor for value, particularly for capital-intensive businesses.
How Wall St Yardie Approaches Valuation
No single model is perfect. Wall St Yardie combines multiple methods and business quality scoring to give you a more complete picture.
Business Quality Score
Before valuation, the app scores the business on profitability, financial strength, and earnings consistency. A high-quality business deserves a higher valuation multiple. A weak business does not.
Fair Value Estimate
The app calculates a fair value range using earnings yield, free cash flow yield, and price-to-book anchors. The range helps you understand the uncertainty in any single-point estimate.
Buy Price with Margin of Safety
The buy price applies a margin of safety to the fair value estimate. This cushion protects against estimation errors and unexpected events. It is the number you use when selling puts or entering positions.
Historical Context
Seeing how a stock's valuation multiples have moved over time reveals whether today's price is historically cheap, fair, or expensive. Context matters as much as calculation.
Why Valuation Matters for Options Traders
Every option strategy rests on knowing what the stock is worth. Without valuation, you are just picking premiums.
Cash-Secured Puts
Set the put strike at or below fair value. Assignment at that price gives you a quality business at a price that makes sense. Without fair value, the strike is a guess.
Covered Calls
Set the call strike above fair value. You collect premium and, if assigned, you sell at a price you are happy with. Without fair value, you might sell too cheaply.
LEAPS
Identify stocks significantly below fair value with a clear upside thesis. The gap between price and value is what makes the LEAPS premium worth paying.
Start with the Right Number
Wall St Yardie calculates fair value for any publicly-traded stock so your buy price, put strikes, and call strikes are anchored in fundamentals, not market noise.
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