Intrinsic Value Calculator
Graham’s revised intrinsic value formula with a growth and bond-yield input.
Graham’s growth formula
Benjamin Graham’s revised formula estimates intrinsic value from earnings and expected growth, adjusted for prevailing bond yields. It is a quick, conservative sanity check on price.
The formula
Value = EPS × (8.5 + 2g) × 4.4 ÷ Y, where g is the growth rate, 8.5 is the base P/E for a no-growth firm, and Y is the AAA corporate bond yield.
Frequently asked questions
Why include bond yield?
It anchors the valuation to interest rates — when safe bonds yield more, equities deserve lower multiples, so the formula lowers the intrinsic value.