FREE TOOL
Graham Number Calculator
Calculate the maximum price Benjamin Graham would pay for any stock. Enter the company's fundamentals below to get an instant result.
INTERACTIVE CALCULATOR
Graham Number Calculator
Enter a company's fundamentals to calculate the maximum price Benjamin Graham would pay.
Enter EPS and Book Value to calculate the Graham Number
For educational purposes only. Not investment advice.
How to Use This Calculator
Enter the company's Earnings Per Share (EPS) using trailing twelve month data from the most recent financial statements. Avoid using forward or estimated EPS — Graham's approach is based on actual reported earnings.
Enter the Book Value Per Share (BVPS), which is total shareholder equity divided by shares outstanding. This represents the net asset value per share.
Optionally enter the Current Stock Price to see whether the stock passes Graham's filter. The calculator will show a verdict (undervalued, fair value, or overvalued) with a visual gauge bar.
The Graham Number Formula
GRAHAM NUMBER
√(22.5 × EPS × Book Value Per Share)
The constant 22.5 comes from Benjamin Graham's two criteria for defensive investing: a maximum P/E ratio of 15 and a maximum Price-to-Book ratio of 1.5. Since 15 × 1.5 = 22.5, the formula combines both limits into a single calculation.
The result represents the maximum price a conservative investor should pay for the stock. If the current market price is below this number, the stock may be undervalued by Graham's standards.
When the Graham Number Works Best
WORKS WELL FOR
- · Banks and financial institutions
- · Utilities with physical infrastructure
- · Industrial and manufacturing companies
- · Insurance companies
- · Mature, asset-rich businesses
LESS RELIABLE FOR
- · Technology and SaaS companies
- · High-growth stocks
- · Companies with negative earnings
- · Asset-light businesses
- · Companies with heavy buybacks
RELATED
This calculator is for educational purposes only and does not constitute investment advice. The Graham Number is one of many valuation methods and should not be used as the sole basis for investment decisions.