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Educational
Asset Based Valuation
Asset-based valuation calculates a company's net asset value (NAV) by subtracting total liabilities from total assets. It provides a floor value for the company.
Core Formula
Net Asset Value
NAV = Total Assets - Total Liabilities
Intrinsic Value Per Share = NAV / Shares Outstanding
Tangible Book Value = NAV - Goodwill - Intangible Assets
When to Use
Best For
Holding companies, REITs, asset-heavy businesses
Limitation
Ignores future growth potential and earnings power
Market Fit
NSE/BSE stocks with significant tangible assets
Typical Use
Floor value estimation, distressed analysis