Margin safety

Thanks for the service, I have a question about the safety margin.
Knowing the published reports on the margin of safety, whether an action in your screener that represents the defensive choice or even that enterprising that comes to 100% of the intrinsic value, to respect the margin of safety how should we do? example if the current price is $100 per share and by calculations the intrinsic value and $101 how to interpret the margin of safety.
Thank you

Submitted by EC. Created on Thursday 5th May 2022. Updated on Thursday 5th May 2022.

Submitted by GrahamValue on Thursday 5th May 2022

Dear EC,

Thank you for your forum post!

In Graham's own words:

"A favorable difference between price on the one hand and indicated or appraised value on the other. That difference is the safety margin."

Benjamin Graham, Chapter 20: “Margin of Safety” as the Central Concept of Investment, The Intelligent Investor.

So the Margin of Safety is essentially the same as the Intrinsic Value(%). In the example you've given, it would be 101%.

Thank you again for your forum post!

Submitted by EC on Thursday 5th May 2022

So monetarily speaking, in my example the safety margin is 1 dollar right?

Submitted by GrahamValue on Thursday 5th May 2022

Dear EC,

Thank you for your comment!

Assuming that the Intrinsic Value had been adjusted for Interest Rates and so on; yes, the Margin of Safety would be $1 in this case.

But please note that the Margin of Safety only considers current stock prices and Intrinsic Values; and is not the same as Upside.

Thank you again for your comment!