Price/Fair Value

The price/fair value ratio measures value by dividing the price of a stock by the fair value estimate as of the most recent market close. A ratio above 1.00 indicates that the stock’s price is higher than Morningstar’s estimate of its fair value; a ratio below 1.00 indicates the stock's price is lower than our estimate of fair value.

The further the price/fair value ratio rises above 1.00, the more it's considered overvalued. The further it moves below 1.00, the more it's considered undervalued.

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Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

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Price/Fair Value

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