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Resources Connection Graham Number

: $8.78 (As of Aug. 2021)
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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 (2021-11-27), the stock price of Resources Connection is $17.51. Resources Connection's graham number for the quarter that ended in Aug. 2021 was $8.78. Therefore, Resources Connection's Price to Graham Number ratio for today is 2.00.

The historical rank and industry rank for Resources Connection's Graham Number or its related term are showing as below:

NAS:RGP' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 1.11   Med: 2.37   Max: 5.03
Current: 1.99

1.11
5.03

During the past 13 years, the highest Price to Graham Number ratio of Resources Connection was 5.03. The lowest was 1.11. And the median was 2.37.

NAS:RGP's Price-to-Graham-Number is ranked lower than
64% of the 132 Companies
in the Business Services industry.

( Industry Median: 1.99 vs. NAS:RGP: 1.99 )

Graham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.


Resources Connection Graham Number Historical Data

The historical data trend for Resources Connection'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.

* Premium members only.

Resources Connection Annual Data
Trend May12 May13 May14 May15 May16 May17 May18 May19 May20 May21
Graham Number
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.34 4.99 7.33 6.54 7.03

Resources Connection Quarterly Data
Nov16 Feb17 May17 Aug17 Nov17 Feb18 May18 Aug18 Nov18 Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21
Graham Number Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 6.42 4.28 3.03 6.94 8.78

Competitive Comparison

For the Consulting Services subindustry, Resources Connection's Graham Number, along with its competitors' market caps and 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.

   

Resources Connection Graham Number Distribution

For the Business Services industry and Industrials sector, Resources Connection's Graham Number distribution charts can be found below:

* The bar in red indicates where Resources Connection's Graham Number falls into.



Resources Connection Graham Number Calculation

Graham Number is a concept based on Ben Graham's conservative valuation of companies.

Resources Connection's Graham Number for the fiscal year that ended in May. 2021 is calculated as

Graham Number
=sqrt of (22.5* Tangible Book per Share *EPS without NRI)
=sqrt of (22.5*2.814*0.78)
=7.03

Resources Connection's Graham Number for the quarter that ended in Aug. 2021 is calculated as

Graham Number
=sqrt of (22.5*Tangible Book per Share*EPS without NRI (TTM))
=sqrt of (22.5*3.17*1.08)
=8.78

* 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.


Resources Connection  (NAS:RGP) 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.

Resources Connection's Price to Graham number Ratio for today is calculated as

Price to Graham number=Share Price (Today)/Graham number (Q: Aug. 2021 )
=17.51/8.78
=2.00

* 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.


Resources Connection Graham Number Related Terms

Thank you for viewing the detailed overview of Resources Connection's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.


Resources Connection Business Description

Resources Connection logo
Industry
Industrials » Business Services NAICS : 561499 SIC : 7389
Traded in Other Exchanges
Address
17101 Armstrong Avenue, Suite 100, Irvine, CA, USA, 92614
Resources Connection Inc provides consulting and business initiative support services primarily through its operative subsidiary, Resources Global Professionals. The company offers transformation and improvement, financial reporting and analysis, strategy development, and program and project management services and support. Its clients operate in the accounting, finance, corporate governance, risk and compliance management, corporate advisory, strategic communications and restructuring, information management, human capital, supply chain management, and legal and regulatory sectors.
Executives
Duchene Kate W director, officer: President & CEO C/O RESOURCES CONNECTION 695 TOWN CENTER DR COSTA MESA CA 92626
Ryu Jennifer Y officer: CFO 17101 ARMSTRONG AVENUE IRVINE CA 92614
Pisano A Robert director C/O RESOURCES CONNECTION 695 TOWN CENTER DR COSTA MESA CA 92626
Von Maltzan Marco director 17101 ARMSTRONG AVE #100 RGP IRVINE CA 92614
Crawford Susan J director 17101 ARMSTRONG AVE IRVINE CA 92614
Shih Anne director 17101 ARMSTRONG AVENUE IRVINE CA 92614
Wargotz Michael H director AXCESS WORLDWIDE 515 MADISON AVE., 15TH FLOOR NEW YORK NY 10022
Cherbak Anthony director 695 TOWN CENTER DRIVE SUITE 600 COSTA MESA CA 92626
Kistinger Robert F director 17101 ARMSTRONG AVE IRVINE CA 92614
Sykes Jolene director 695 TOWN CENTER DRIVE SUITE 606 COSTA MESA CA 92626
Dimick Neil F director BUILDING 4, TRIDENT PLACE MOSQUITO WAY HATFIELD, HERTFORDSHIRE X0 AL10 9UL
Brackney Timothy L officer: President and COO 12 ANDERSON WAY MENLO PARK CA 94025
Bower John D officer: Chief Accounting Officer C/O RESOURCES CONNECTION 695 TOWN CENTER DR COSTA MESA CA 92626
Murray Donald B director RESOURCES CONNECTION 695 TOWN CTR DR STE 600 COSTA MESA CA 92626
Mueller Herbert M officer: CFO & EVP PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> Ownership Information: MUELLER HERBERT M a.header:link {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:visited {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:hover {color: #191970;}

Resources Connection Headlines

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