Short Definition (click to see data)
Margin of Safety (potential), or safety margin, is a term produced by Benjamin Graham and used by Warren Buffett to measure the degree of potential for a stock. If the margin is positive, then the stock is undervalue and the investor should buy; otherwise, the investor should sell. Investment potential is always the same no matter the currency or stock exchange where the company trades.
Wiki Wealth uses a margin of safety of 50% to make conservative estimates of the potential of the company. If the margin of safety is above 50%, then an investor should buy the stock.
Margin of safety (safety margin) is the difference between the intrinsic value of a stock and its market price.
Another definition: In Break even analysis (accounting), margin of safety is how much output or sales level can fall before a business reaches its breakeven point.
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Source: http://en.wikipedia.org/wiki/Margin_of_safety_(financial)
