GoDaddy has made its domain name appraisal tool public, and visitors are now able to appraise any domain name. I believe the algorithm used for these (free) automated domain appraisals is the same one that has been used within GoDaddy Auctions and the appraisal provided in domain settings pages within a user’s control panel.
When a visitor types in a domain name to be appraised, GoDaddy provides its appraisal along with what it believes is supporting public comparable sales. The maximum valuation is $25,000 and domain names that are valued at $25,000 shows a message that says “Estimated Value: more than $25,000.” The minimum valuation is $100, and domain names that are valued at less than $100 have a message that says “Estimated Value: less than $100.” In my opinion, $25,000 is pretty low for a maximum appraisal.
On the sidebar, GoDaddy shares some of the reasons for why a domain name is valuable. Some of the factors include comparable sales, the domain name extension, the keyword(s), and the length of the domain name. If the domain name is listed for sale via Afternic, there is a clear purchase link so a visitor could click through to buy the domain name via GoDaddy.
I looked up several higher value domain names my company owns, and some of the appraisals seem very low to me. I would hate for a third party to try and use a GoDaddy automated appraisal as justification for a lower offer or to be pushed back on my price because of one of these appraisals. With the popularity of GoDaddy, I am sure it is a matter of time until that happens.
The tool is still in beta, so it will likely be refined over time.