Graham Number Calculator
Find the Graham number from EPS and book value per share, and compare it with the share price to see the margin of safety.
Quick answer
The Graham number is a value-investing ceiling price for a share: the square root of (multiplier x EPS x book value per share), with the multiplier at 22.5 by default. Prices below it show a margin of safety.
Graham Number Calculator
15 × 1.5 = 22.5 is the classic value.
Graham Number
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Margin of Safety
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Graham Number vs. Price
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P/E
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P/B
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P/E × P/B (limit = multiplier)
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If EPS Were Different
| EPS Change | EPS (₹) | Graham Number (₹) | Margin of Safety |
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Assumptions & method
- Graham number = √(multiplier × EPS × BVPS), with a default multiplier of 22.5 (15 × 1.5).
- Margin of safety = (Graham number − price) ÷ Graham number. Graham number vs. price = Graham number ÷ price − 1.
- Equivalent test: P/E × P/B at or below the multiplier means the price is at or below the Graham number.
- Both EPS and BVPS must be above zero for the number to exist. It ignores growth, debt, earnings quality and industry.
- This is an educational screening tool and an estimate. It is not investment advice.
Results are estimates based on the figures you enter. They are not guarantees and not financial advice.
How the Graham number works
Benjamin Graham suggested that a defensive investor should avoid paying more than about 15 times earnings or 1.5 times book value, and that a somewhat higher earnings multiple could be accepted if book value was low. Multiplying the two limits gives 22.5, and the Graham number is the square root of 22.5 × EPS × book value per share. It gives a single price that blends earnings power and asset backing. Comparing it with the market price gives a margin of safety. It works best for steady, asset-heavy companies and poorly for growth or asset-light ones.