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Graham Growth Valuation Scenario

Explore an earnings and growth valuation rule with an editable bond-yield assumption and price comparison.

Formula & worked example
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How to use this calculator

Enter the known values in the units shown. Results update as you type.
Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

EPS of 2, growth of 5 percentage points and bond yield of 4.4 give a modeled share value of 37. A market price of 29.6 is 20% below that value.

V = EPS × (8.5 + 2g) × 4.4 / Y; safety = (V − price) / V × 100.

Worked example

Enter these known values and leave the other values blank.

Earnings per share (EPS): 2 USD
Expected annual growth rate (g): 5 %
Corporate bond yield (Y): 4.4 %
Current market price (CMP): 29.6 USD

Intrinsic value per share (V): 37 USD
Margin of safety (MS): 20 %

Assumptions and limitations

This is a historical valuation heuristic, not a prediction or investment recommendation. The 8.5 and 4.4 coefficients are fixed model assumptions.
Growth and yield are entered in percentage points: 5 means 5%. Use positive earnings and positive yield; the heuristic is poorly suited to loss-making companies.
Amounts use a single consistent currency. Currency selector conversion factors are a captured static snapshot; they are not current FX quotes.
Clear the unknown field before solving an inverse. Locks keep known values fixed; contradictory locked values require correction.
Domain review limits calculations to the documented finite scenario; original captured equations, inverses and unit options are retained.

Common questions

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