Longview

Fair value averages two classic models. The earnings model grows today's earnings per share at the expected rate for 5 years, then at half that rate for 5 more, adds the dividends paid along the way, values year-10 earnings at 17 times (roughly the long-run market average), and discounts everything back at 8% a year. The Graham formula is Benjamin Graham's shortcut: earnings × (8.5 + 2 × growth rate), with growth capped at 15%.

Expected growth comes from analysts' average earnings-per-share estimates for the next ~3 years where they exist. Otherwise it falls back to the company's own 5-year earnings history, capped at 15%. The stock report tells you which one was used.

5-year projections combine earnings growth, the dividend, and where the P/E ratio might drift. The base case grows earnings at the expected rate and moves the P/E halfway toward a "normal" level for that growth (10 + 1.5 × growth). The bear case halves growth and shrinks the P/E. The bull case adds 30% to growth and keeps the higher P/E. Funds use a long-run return assumption instead, shown on each fund's report.

These models are simple on purpose, so you can check the math. Real results regularly land outside the bear-to-bull range. Nothing here is financial advice.