Graham Number Calculator
Calculate any stock's intrinsic value using Benjamin Graham's proven formula. Find out if a stock is undervalued, fairly priced, or overpriced — instantly.
📊Graham Intrinsic Value Calculator
Is your stock undervalued? Enter the numbers and find out instantly.
Try an example:
How to Use This Calculator
Our Graham Number Calculator uses two of Benjamin Graham's most important valuation formulas to determine if a stock is undervalued:
Formula 1: The Graham Number
Graham Number = √(22.5 × EPS × Book Value Per Share)
This gives you the maximum price a defensive investor should pay. The 22.5 multiplier comes from Graham's rule that a stock's P/E should not exceed 15 and P/B should not exceed 1.5 (15 × 1.5 = 22.5).
Formula 2: Graham's Intrinsic Value
V = EPS × (8.5 + 2g) × 4.4 / Y
Where g is the expected annual growth rate and Y is the current AAA corporate bond yield. This formula accounts for growth potential.
Where to Find the Numbers
- EPS (Earnings Per Share) — Yahoo Finance, Finviz, or any stock screener. Use trailing twelve months (TTM).
- Book Value Per Share — Found on the balance sheet. Yahoo Finance shows this under "Statistics."
- Growth Rate — Use the analyst consensus 5-year earnings growth estimate, or a conservative estimate of your own.
- Current Price — The stock's current market price.
Understanding the Results
- Strong Buy (30%+ margin of safety) — The stock is significantly undervalued. Classic Graham territory.
- Buy (15-30% margin) — Good value with reasonable downside protection.
- Fair Value (0-15% margin) — Priced about right. Not a bargain, not expensive.
- Overvalued (negative margin) — The stock is trading above its calculated worth. Avoid or wait for a pullback.
Limitations
No single formula can capture a company's full value. The Graham Number works best for established, profitable companies with stable earnings. It's less useful for high-growth tech stocks, pre-profit companies, or companies with unusual balance sheets.
Always combine quantitative analysis with qualitative research — competitive position, management quality, industry trends, and regulatory risks. The calculator is a starting point, not the final answer.