Graham Number is a figure that measures a stock's fundamental value by taking into account the company's earnings per share and book value per share. The Graham number is the upper bound of the price range that a defensive investor should pay for the stock. According to the theory, any stock price below the Graham number is considered undervalued, and thus worth investing in.
As of today (2024-04-26), the stock price of 1st Century Bancshrs is $11.22. 1st Century Bancshrs's graham number for the quarter that ended in Mar. 2016 was $6.11. Therefore, 1st Century Bancshrs's Price to Graham Number ratio for today is 1.84.
The historical rank and industry rank for 1st Century Bancshrs's Graham Number or its related term are showing as below:
FCTY's Price-to-Graham-Number is not ranked *
in the Banks industry.
Industry Median: 0.625 * Ranked among companies with meaningful Price-to-Graham-Number only.
Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.
1st Century Bancshrs Graham Number Historical Data
The historical data trend for 1st Century Bancshrs's Graham Number can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of 1st Century Bancshrs's Graham Number
For the Banks - Regional subindustry, 1st Century Bancshrs's Price-to-Graham-Number, along with its competitors' market caps and Price-to-Graham-Number data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
1st Century Bancshrs's Price-to-Graham-Number Distribution in the Banks Industry
For the Banks industry and Financial Services sector, 1st Century Bancshrs's Price-to-Graham-Number distribution charts can be found below:
* The bar in red indicates where 1st Century Bancshrs's Price-to-Graham-Number falls into.
1st Century Bancshrs Graham Number Calculation
Graham Number is a concept based on Ben Graham's conservative valuation of companies.
1st Century Bancshrs's Graham Number for the fiscal year that ended in Dec. 2015 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
1st Century Bancshrs (NAS:FCTY) Graham Number Explanation
Ben Graham actually did not publish a formula like this. But he wrote in The Intelligent Investor (1948 version) regarding to the criteria for purchases:
Current price should not be more than 15 times average earnings of the past three years.
Current price should not be more than 1.5 times the book value last reported. However, a multiplier of earnings below 15 could justify a correspondingly higher multiplier of assets. As a rule of thumb we suggest that the product of the multiplier times the ratio of price to book value should not exceed 22.5. (This figure corresponds to 15 times earnings and 1.5 times book value. It would admit an issue selling at only 9 times earnings and 2.5 times asset value, etc.)
Unlike valuation methods such as DCF or Discounted Earnings, the Graham number does not take growth into the valuation. Unlike the valuation methods based on book value alone, it takes into account the earnings power. Therefore, the Graham Number is a combination of asset valuation and earnings power valuation.
In general, the Graham number is a very conservative way of valuing a stock. It cannot be applied to companies with negative book values.
1st Century Bancshrs's Price to Graham number Ratio for today is calculated as
Price to Graham number
=
Share Price (Today)
/
Graham number (Q: Mar. 2016 )
=
11.22
/
6.11
=
1.84
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Be Aware
Please keep these in mind:
1. Graham Number does not take growth into account. Therefore it underestimates the values of the companies that have good earnings growth. We feel that if the earnings per share grows more than 10% a year, Graham Number underestimates the value.
2. Graham Number punishes the companies that have temporarily low earnings. Therefore, an average of earnings makes more sense in the calculation of Graham Number.
3. Graham Numbers underestimates companies that are light with book.
1st Century Bancshrs Graham Number Related Terms
Thank you for viewing the detailed overview of 1st Century Bancshrs's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.
1st Century Bancshrs (1st Century Bancshrs) Business Description
1st Century Bancshrs Inc is a Delaware corporation. The Company operates as a bank holding company for 1st Century Bank, N.A., a National Association (the Bank). The Bank is a full service commercial bank. The bank's main focus is relationship banking to family and closely held middle market businesses, professional service firms, and high net worth individuals, real estate investors and entrepreneurs. The Bank also provides various banking services to meet the financial needs of the local residential community, with an orientation mainly directed toward owners and employees of its business client base. The Bank's product offerings includes: Loans and Deposits. Loans consist of business and personal lines of credit and term loans; tenant improvement and equipment financing; bridge and/or specific purpose loans; commercial, industrial and multi-family real estate lending; personal home equity loans and lines of credit; and credit cards for business and personal use. Deposits consist of business checking, money market and certificates of deposit; personal checking, money market and certificates of deposits; Attorney-Client trust accounts; trust accounts; cash management and on-line banking; and Debit cards. The general market area it serves is defined as La Cienega Boulevard to the east, the Santa Monica Mountains to the north, the Pacific Ocean to the west and the Los Angeles International Airport to the south. The Bank competes with other banks and financial institutions to attract deposits. The Bank faces competition from established local and regional banks and savings and loan institutions. The Company and its subsidiaries are subject to significant regulation and restrictions by Federal and State laws and regulatory agencies. The Bank is subject to both the regulation of and periodic examinations by the Office of the Comptroller of the Currency, which is the Bank's primary federal regulatory agency.
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