GURUFOCUS.COM » STOCK LIST » USA » NAS » Rush Enterprises Inc (NAS:RUSHB) » Definitions » Graham Number
Switch to:

Rush Enterprises Graham Number

: $52.38 (As of Jun. 2022)
View and export this data going back to 2002. Start your Free Trial

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 (2022-08-16), the stock price of Rush Enterprises is $59.71. Rush Enterprises's graham number for the quarter that ended in Jun. 2022 was $52.38. Therefore, Rush Enterprises's Price to Graham Number ratio for today is 1.14.

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

RUSHB' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 0.41   Med: 1.12   Max: 2.88
Current: 1.01

During the past 13 years, the highest Price to Graham Number ratio of Rush Enterprises was 2.88. The lowest was 0.41. And the median was 1.12.

RUSHB's Price-to-Graham-Number is ranked better than
59.61% of 869 companies
in the Vehicles & Parts industry
Industry Median: 1.24 vs RUSHB: 1.01

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


Rush Enterprises Graham Number Historical Data

The historical data trend for Rush Enterprises'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.

Rush Enterprises Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Graham Number
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 27.00 26.23 28.88 27.48 41.49

Rush Enterprises Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 35.38 39.63 41.49 46.58 52.38

Competitive Comparison

For the Auto & Truck Dealerships subindustry, Rush Enterprises'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.

   

Rush Enterprises Graham Number Distribution

For the Vehicles & Parts industry and Consumer Cyclical sector, Rush Enterprises's Graham Number distribution charts can be found below:

* The bar in red indicates where Rush Enterprises's Graham Number falls into.



Rush Enterprises Graham Number Calculation

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

Rush Enterprises's Graham Number for the fiscal year that ended in Dec. 2021 is calculated as

Graham Number
=sqrt of (22.5* Tangible Book per Share *EPS without NRI)
=sqrt of (22.5*18.348*4.17)
=41.49

Rush Enterprises's Graham Number for the quarter that ended in Jun. 2022 is calculated as

Graham Number
=sqrt of (22.5*Tangible Book per Share*EPS without NRI (TTM))
=sqrt of (22.5*20.671*5.9)
=52.38

* 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.


Rush Enterprises  (NAS:RUSHB) 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.

Rush Enterprises's Price to Graham number Ratio for today is calculated as

Price to Graham number=Share Price (Today)/Graham number (Q: Jun. 2022 )
=59.71/52.38
=1.14

* 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.


Rush Enterprises Graham Number Related Terms

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


Rush Enterprises Business Description

Rush Enterprises logo
Traded in Other Exchanges
Address
555 IH-35 South, Suite 500, New Braunfels, TX, USA, 78130
Rush Enterprises is the only publicly traded, standalone commercial truck dealer in North America. With 120 locations, it sells 5.6% of new class 8 trucks as the largest truck dealer on the continent. Vehicle sales include class 4-8 new trucks as well as range of used commercial vehicles. Aftermarket parts and service are key drivers of profitability as they generate approximately 30% of revenue and 65% of gross profit. Rush's class 8 customers include large fleets (32%), mid-size fleets (16%), vocational customers (40%), and owner-operators (12%). In 2019, Rush generated $5.8 billion in revenue.

Rush Enterprises Headlines

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)