# Intrinsic Value Calculator (Graham Formula)

URL: https://speedycalculator.com/calculators/finance/intrinsic-value/
Last updated: 2026-10-25

> The intrinsic value calculator estimates a stock's value with Benjamin Graham's revised growth formula – using EPS, expected growth and the current AAA corporate bond yield – and the margin of safety against the market price.

## Inputs

- Earnings per share
- Expected annual growth rate (%)
- Current AAA corporate bond yield (%)
- Current market price

## Results

- Intrinsic value per share
- Margin of safety
- Implied P/E

## Formula

```
V = EPS × (8.5 + 2g) × 4.4 ÷ Y
g = expected annual growth (next 7–10 years, %); Y = current AAA corporate bond yield (%)
Margin of safety = (V − price) ÷ V
```

## Explanation

Graham's formula gives a no-growth company a P/E of 8.5 and adds two P/E points for each percent of expected growth, adjusted for interest rates (4.4% was the AAA yield when he wrote it). Use cautious growth estimates.

### How to use the Intrinsic Value Calculator

- **Earnings per share**
- **Expected annual growth rate**
- **Current AAA corporate bond yield**
- **Current market price**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter EPS, the expected annual growth rate, the current AAA corporate bond yield and the market price.

### Tips

- Take figures from the same financial statements and the same fiscal year.
- Compare ratios with companies in the same industry, not across industries.
- Use several valuation measures together; no single ratio tells the whole story.
- Market prices change every second – refresh the share price before you rely on a result.

### Common mistakes to avoid

- Mixing per-share figures with company totals.
- Using trailing earnings for one company and forward earnings for another.
- Forgetting dilution from options and convertible securities.

### Inputs explained

FieldWhat to enterEarnings per shareAmount in your currencyExpected annual growth rateIn %Current AAA corporate bond yieldIn %Current market priceAmount in your currency

### What each result means

- **Intrinsic value per share** = [Earnings per share]×(8.5 + 2×[Expected annual growth rate])×4.4÷[Current AAA corporate bond yield]
- **Margin of safety** = ([Intrinsic value per share] - [Current market price])÷[Intrinsic value per share]×100
- **Implied P/E** = [Intrinsic value per share]÷[Earnings per share]

### Example values

How the main result changes when **Earnings per share** changes and everything else stays at the example values above:

Earnings per shareIntrinsic value per share2.543.373.7565.05586.736.25108.417.5130.110173.46

## Worked example

Inputs — Earnings per share: $5; Expected annual growth rate: 6 %; Current AAA corporate bond yield: 5.2 %; Current market price: $75.

Results — **Intrinsic value per share = $86.73**; Margin of safety = 13.53 %; Implied P/E = 17.35.

## FAQ

**What is intrinsic value?**
An estimate of a stock's true worth based on fundamentals.

**What margin of safety should I want?**
Graham suggested buying at least a third below intrinsic value.

**Why include the bond yield?**
Higher interest rates reduce what investors should pay for earnings.

**What formula does the Intrinsic Value Calculator use?**
V = EPS × (8.5 + 2g) × 4.4 ÷ Y.