---
title: Valuation
description: Valuation involves various methods for determining the value of a company and the price of its stock. Valuing a company is called fundamental analysis.
---

[Realized 1031 Glossary of Terms ](https://www.realized1031.com/glossary)

# [Valuation](https://www.realized1031.com/glossary/valuation)

 Written by [The Realized Team](https://www.realized1031.com/glossary/author/the-realized-team) | Jun 27, 2022 12:00:00 PM

Valuation involves various methods for determining the value of a company and the price of its stock. Valuing a company is called fundamental analysis. Taking into account the company’s assets, profits, sales growth, and other related metrics, one can determine a value for a company. Dividing earnings by the average outstanding common shares of stock provides earnings per share (EPS), which can determine if a stock is over or undervalued, compared to competitors within its industry. Knowing that a company’s stock is overvalued can mean it is an investment to avoid, while one that is undervalued is may be a good investment.

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