Graham Number
EliteDefensive fair-value ceiling — √(22.5 × EPS × book)The Graham Number (Benjamin Graham, The Intelligent Investor) is the square root of 22.5 × trailing EPS × book value per share, a fair-value ceiling for a defensive stock, where 22.5 = Graham's 15× earnings × 1.5× book heuristic. It only exists when both EPS and book value per share are positive, so loss-makers and negative-equity names are dropped. Margin of safety = (Graham Number − price) ÷ price; positive means the stock trades below its Graham Number. Most large caps trade well above, so this is a ranked leaderboard, not a pass/fail gate. Not investment advice.
How it works
Benjamin Graham's ceiling for a defensive investor. He was not trying to find fair value. He was drawing a line above which he would not pay, using two numbers any careful reader could pull from an annual report.
The 22.5 is his two rules multiplied together: no more than fifteen times earnings, and no more than one and a half times book value.
When it misleads
Book value stopped describing most modern companies. A business whose assets are code, brands and people carries almost none of it, so the ceiling comes out absurdly low and nearly everything looks expensive.
It uses a single year of earnings. One bad year drags the ceiling down and makes a sound company look overpriced.
| # | Ticker | Price | Graham № | Margin of safety | EPS | Book/sh | Verdict |
|---|---|---|---|---|---|---|---|
| 101 | AIZ | $307.08 | $240.82 | -21.6% | 21.20 | 121.58 | Fair |
| 102 | DUK | $127.77 | $100.17 | -21.6% | 6.82 | 65.38 | Fair |
| 103 | TTD | $12.92 | $10.12 | -21.7% | 0.83 | 5.48 | Fair |
| 104 | CCL | $29.59 | $23.15 | -21.8% | 2.27 | 10.49 | Fair |
| 105 | XEL | $79.67 | $62.25 | -21.9% | 4.29 | 40.15 | Fair |
| 106 | LDOS | $132.66 | $103.32 | -22.1% | 11.19 | 42.40 | Fair |
| 107 | COP | $136.25 | $106.01 | -22.2% | 9.49 | 52.63 | Fair |
| 108 | ELV | $425.60 | $330.98 | -22.2% | 23.55 | 206.75 | Fair |
| 109 | CNC | $69.70 | $54.20 | -22.2% | 2.91 | 44.87 | Fair |
| 110 | PPL | $35.83 | $27.85 | -22.3% | 1.74 | 19.81 | Fair |
| 111 | NUE | $244.97 | $188.66 | -23.0% | 15.70 | 100.75 | Fair |
| 112 | AFL | $124.04 | $95.52 | -23.0% | 6.85 | 59.20 | Fair |
| 113 | EVRG | $87.53 | $66.97 | -23.5% | 4.49 | 44.39 | Fair |
| 114 | MS | $181.39 | $138.70 | -23.5% | 12.61 | 67.80 | Fair |
| 115 | BKR | $47.84 | $36.44 | -23.8% | 2.91 | 20.28 | Fair |
| 116 | BXP | $65.03 | $49.43 | -24.0% | 3.34 | 32.51 | Fair |
| 117 | KMI | $29.96 | $22.74 | -24.1% | 1.62 | 14.18 | Fair |
| 118 | NWSA | $26.39 | $19.88 | -24.6% | 1.12 | 15.69 | Fair |
| 119 | ATO | $173.28 | $130.56 | -24.7% | 8.39 | 90.29 | Fair |
| 120 | SWK | $114.85 | $86.41 | -24.8% | 5.58 | 59.47 | Fair |
| 121 | KIM | $25.52 | $19.18 | -24.8% | 1.07 | 15.29 | Fair |
| 122 | MGM | $32.33 | $24.13 | -25.3% | 2.60 | 9.95 | Fair |
| 123 | BNY | $147.71 | $108.95 | -26.2% | 9.03 | 58.43 | Fair |
| 124 | ZBH | $105.59 | $77.20 | -26.9% | 3.96 | 66.89 | Fair |
| 125 | INVH | $27.09 | $19.72 | -27.2% | 1.14 | 15.16 | Fair |
| 126 | PEG | $72.61 | $52.70 | -27.4% | 3.54 | 34.86 | Fair |
| 127 | BRO | $72.11 | $52.31 | -27.5% | 3.16 | 38.48 | Fair |
| 128 | TSN | $59.69 | $43.28 | -27.5% | 1.62 | 51.39 | Fair |
| 129 | AEE | $112.81 | $81.49 | -27.8% | 5.75 | 51.33 | Fair |
| 130 | BABA | $109.49 | $79.08 | -27.8% | 4.13 | 67.31 | Fair |
| 131 | XOM | $165.87 | $119.38 | -28.0% | 9.72 | 65.16 | Fair |
| 132 | AEP | $126.52 | $91.04 | -28.0% | 6.12 | 60.19 | Fair |
| 133 | BSX | $42.75 | $30.71 | -28.2% | 2.37 | 17.68 | Fair |
| 134 | PGR | $227.77 | $163.10 | -28.4% | 19.85 | 59.56 | Fair |
| 135 | DAL | $87.19 | $62.28 | -28.6% | 5.01 | 34.41 | Fair |
| 136 | DIS | $116.74 | $83.31 | -28.6% | 4.85 | 63.60 | Fair |
| 137 | SNDK | $834.77 | $595.42 | -28.7% | 125.12 | 125.93 | Fair |
| 138 | CRH | $94.83 | $67.01 | -29.3% | 5.31 | 37.58 | Fair |
| 139 | ROP | $476.59 | $331.83 | -30.4% | 25.27 | 193.66 | Expensive |
| 140 | NEE | $86.95 | $60.51 | -30.4% | 5.55 | 29.32 | Expensive |
| 141 | FE | $46.44 | $32.31 | -30.4% | 2.07 | 22.41 | Expensive |
| 142 | DTE | $135.14 | $93.49 | -30.8% | 6.56 | 59.22 | Expensive |
| 143 | AFRM | $68.08 | $46.94 | -31.1% | 5.77 | 16.97 | Expensive |
| 144 | XYL | $97.86 | $67.27 | -31.3% | 4.51 | 44.59 | Expensive |
| 145 | NWS | $28.96 | $19.88 | -31.3% | 1.12 | 15.69 | Expensive |
| 146 | TMUS | $161.94 | $111.18 | -31.3% | 10.37 | 52.98 | Expensive |
| 147 | D | $68.61 | $47.04 | -31.4% | 3.03 | 32.46 | Expensive |
| 148 | SCHW | $91.47 | $62.57 | -31.6% | 5.85 | 29.75 | Expensive |
| 149 | WRB | $75.25 | $51.29 | -31.8% | 4.73 | 24.72 | Expensive |
| 150 | HST | $24.63 | $16.77 | -31.9% | 1.35 | 9.26 | Expensive |