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Voya Prime Rate Trust Graham Number

: USD2.74 (As of Feb. 2020)
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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 (2020-09-28), the stock price of Voya Prime Rate Trust is USD4.44. Voya Prime Rate Trust's graham number for the quarter that ended in Feb. 2020 was USD2.74. Therefore, Voya Prime Rate Trust's Price to Graham Number ratio for today is 1.62.

NYSE:PPR' s Price-to-Graham-Number Range Over the Past 10 Years
Min: 1.08   Med: 1.12   Max: 1.7
Current: 1.62

1.08
1.7

During the past 3 years, the highest Price to Graham Number ratio of Voya Prime Rate Trust was 1.70. The lowest was 1.08. And the median was 1.12.

NYSE:PPR's Price-to-Graham-Number is ranked lower than
74% of the 742 Companies
in the Asset Management industry.

( Industry Median: 0.94 vs. NYSE:PPR: 1.62 )

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


Voya Prime Rate Trust Graham Number Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Voya Prime Rate Trust Annual Data
Feb18 Feb19 Feb20
Graham Number 4.80 4.32 2.89

Voya Prime Rate Trust Semi-Annual Data
Aug17 Feb18 Aug18 Feb19 Aug19 Feb20
Graham Number Premium Member Only 0.00 5.76 4.14 2.87 2.74

Competitive Comparison
* 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.


Voya Prime Rate Trust Graham Number Distribution

* The bar in red indicates where Voya Prime Rate Trust's Graham Number falls into.



Voya Prime Rate Trust Graham Number Calculation

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

Voya Prime Rate Trust's Graham Number for the fiscal year that ended in Feb. 2020 is calculated as

Graham Number
=sqrt of (22.5* Tangible Book per Share *EPS without NRI)
=sqrt of (22.5*5.297*0.07)
=2.89

Voya Prime Rate Trust's Graham Number for the quarter that ended in Feb. 2020 is calculated as

Graham Number
=sqrt of (22.5*Tangible Book per Share*EPS without NRI (TTM))
=sqrt of (22.5*5.297*0.063092)
=2.74

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Voya Prime Rate Trust  (NYSE:PPR) 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.

Voya Prime Rate Trust's Price to Graham number Ratio for today is calculated as

Price to Graham number=Share Price (Today)/Graham number (Q: Feb. 2020 )
=4.44/2.74
=1.62

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's 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.


Voya Prime Rate Trust Graham Number Related Terms


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