Market Cap : 55.33 B | Enterprise Value : 136.95 B | PE Ratio : 6.87 | PB Ratio : 0.86 |
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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 (2022-08-10), the stock price of General Motors Co is $37.95. General Motors Co's graham number for the quarter that ended in Jun. 2022 was $68.19. Therefore, General Motors Co's Price to Graham Number ratio for today is 0.56.
The historical rank and industry rank for General Motors Co's Graham Number or its related term are showing as below:
During the past 13 years, the highest Price to Graham Number ratio of General Motors Co was 5.06. The lowest was 0.45. And the median was 0.79.
GM's Price-to-Graham-Number is ranked better thanGraham Number is a combination of asset valuation and earnings power valuation. It is a very conservative way of valuing a stock.
The historical data trend for General Motors Co'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.
For the Auto Manufacturers subindustry, General Motors Co'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.
For the Vehicles & Parts industry and Consumer Cyclical sector, General Motors Co's Graham Number distribution charts can be found below:
* The bar in red indicates where General Motors Co's Graham Number falls into.
Graham Number is a concept based on Ben Graham's conservative valuation of companies.
General Motors Co'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 | * | 36.438 | * | 6.7) |
= | 74.11 |
General Motors Co'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 | * | 39.294 | * | 5.26) |
= | 68.19 |
* 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.
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.
General Motors Co's Price to Graham number Ratio for today is calculated as
Price to Graham number | = | Share Price (Today) | / | Graham number (Q: Jun. 2022 ) |
= | 37.95 | / | 68.19 | |
= | 0.56 |
* 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.
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.
Thank you for viewing the detailed overview of General Motors Co's Graham Number provided by GuruFocus.com. Please click on the following links to see related term pages.
Bhusri Aneel | director | |
Tatum Mark A. | director | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Whitman Margaret C | director | EBAY INC. 2145 HAMILTON AVENUE SAN JOSE CA 95125 |
Carlisle Stephen K. | officer: Executive Vice President | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Jacobson Paul A | officer: Executive Vice President & CFO | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Stapleton John P. | officer: CFO | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Blissett Julian G. | officer: Executive Vice President | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Parks Douglas L | officer: Executive Vice President | 300 RENAISSANCE CENTER M/C: 482-C23-A68 DETROIT MI 48265 |
Johnson Gerald | officer: Executive Vice President | 300 RENAISSANCE CENTER M/C: 482-C23-A68 DETROIT MI 48265 |
Bush Wesley G | director | 333 MAPLE AVENUE EAST #3080 VIENNA VA 22180 |
Miscik Judith A | director | 300 RENAISSANCE CENTER M/C: 482-C24-A68 DETROIT MI 48265 |
Suryadevara Dhivya | officer: Executive Vice President & CFO | 300 RENAISSANCE CENTER M/C: 482-C23-A68 DETROIT MI 48265 |
Hatto Christopher | officer: VP, Controller & CAO | 27175 HAGGERTY ROAD NOVI MI 49377 |
Wenig Devin | director | C/O EBAY INC. 2025 HAMILTON AVENUE SAN JOSE CA 95125 |
Boler-davis Alicia S | officer: Executive Vice President | 300 RENAISSANCE CENTER M/C: 482-C23-D24 DETROIT MI 48265-3000 |
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