Finance

PVGO Calculator

Determine the growth premium embedded in a stock's price.

Stock Price ($)

EPS ($)

Required Rate of Return (%)

PVGO—

No-Growth Value (EPS/r)—

Growth % of Price—

PVGO = Price − (EPS / r)
Where r = required rate of return

What is PVGO?

PVGO separates a stock's price into two components: the value if earnings stayed flat forever (EPS/r) and the premium paid for future growth. A high PVGO/Price ratio means investors are paying heavily for growth expectations.