Graham fair price calculator
Enter earnings per share (EPS), book value per share (BVPS) and the current price to see the fair price and margin of safety.
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Fair price
R$67.08
- Margin of safety
- 34.2%
Your result in words
With EPS of R$5.00 and BVPS of R$40.00, the Graham fair price is R$67.08. With the stock at R$50.00, the margin of safety is 34.16%.
Informational estimate, without fees or inflation. Check taxes and charges for your case; the real result may differ.
How it works
Graham formula
Benjamin Graham proposed estimating a stock intrinsic value as the square root of 22.5 times earnings per share times book value per share. The 22.5 comes from a maximum P/E of 15 and a maximum P/B of 1.5.
Model limits
The formula only works for companies with positive earnings and equity and ignores growth, debt and sector. Use it as a first screen, alongside other indicators, not as a buy recommendation.
Formula
How to calculate
V is the fair price, E the earnings per share (EPS), B the book value per share (BVPS) and P the current price. MS is the margin of safety: positive when the stock trades below the fair price.
Example
With round numbers, so you can check the math:
With EPS of R$5.00 and BVPS of R$40.00, the Graham fair price is R$67.08. With the stock at R$50.00, the margin of safety is 34.16%.
Frequently asked questions
What are EPS and BVPS?
EPS is net income over the last 12 months divided by the number of shares. BVPS is shareholders equity divided by the number of shares. Both appear on market data sites.
Why 22.5?
It is the product of the maximum P/E of 15 and the maximum P/B of 1.5 that Graham considered acceptable for a defensive stock.
Does the calculator recommend buying?
No. The result is a simplified estimate. Decide with your own analysis and, if needed, an investment professional.
Math checked by the JuntaTudo team · updated on Nov 12, 2026
