Benjamin Graham Multiplier

What is the definition of Graham Multiplier?

As defined in the Intelligent Investor, the classic book on Value Investing by Benjamin Graham, this ratio is defined as the PE Ratio multiplied by the Price to Book Ratio.

Stockopedia explains Graham Multiplier...

While Graham preferred defensive investors to look for companies having a PE Ratio of less than 20 and a P/B ratio of less than 1.5, the P/B component is often too restrictive. By specifying a Graham Multiplier of less than 22.5, higher P/B stocks that trade on a very low PE multiple could still pass his screens.

Which Guru Screens is Graham Multiplier used in?

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  • Apple (AAPL)

  • Shell (RDSA)

  • Twitter (TWTR)

  • Volkswagon AG (VOK)

  • McDonalds (MCD)

  • Vodafone (VOD)

  • Barratt Homes (BDEV)

  • Microsoft (MSFT)

  • Tesco (TSCO)
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