Graham number
Compute Benjamin Graham’s conservative fair-value ceiling from a company’s earnings and book value, and compare it with the market price to see the margin of safety.
Runs entirely in your browserRuns entirely on your device — nothing you type is sent anywhere. Educational only, and not investment advice.
How to use this calculator
Each step names a control you will find on screen above.
- EPS
Earnings per share. The Graham number needs positive earnings — it is undefined for loss-making companies.
- Book value per share
Net assets per share. Together with EPS it forms the two pillars of the formula, √(22.5 × EPS × BVPS).
- Market price
The current share price, so the tool can show how far above or below the Graham number the stock trades.
Worked example: ₹50 EPS, ₹200 book value
EPS of ₹50, book value per share of ₹200, market price ₹350.
What to enter
- EPS
- ₹50
- Book value / share
- ₹200
- Market price
- ₹350
What it shows you
- Graham number
- ≈ ₹474
- Market price
- ₹350
- Margin of safety
- ≈ 26%
- Reading
- Below the ceiling — not obviously expensive
Where this is taught
A calculator gives you a number. These explain what the number means and when it misleads you.
- Fundamental Analysis9 minThe Graham number: a quick fair-value sanity checkBenjamin Graham’s back-of-the-envelope ceiling for a defensive investor’s price — built from just earnings and book value. What it does, the formula, and the narrow set of stocks it fits.
- Fundamental Analysis9 minWhat fundamental analysis is trying to doSeparating price from value, the two questions every analysis must answer, and why this discipline is slow by design.
- Fundamental Analysis10 minGraham net-nets: buying a company for less than its cashBenjamin Graham’s deepest bargain: a stock priced below the liquidation value of its current assets alone, fixed assets thrown in free. How NCAV works, the two-thirds rule, and why they are so rare.
- Fundamental Analysis11 minRelative valuation and the margin of safetyComparing a company to its peers and to its own history — faster than a DCF, easier to abuse, and how to decide what discount you actually need.
- Fundamental Analysis12 minReverse DCF: what the price already assumesInstead of forecasting and getting a value, take the price and solve for the forecast. It turns valuation into a question you can actually answer.