The Benjamin Graham formula is an intrinsic value formula proposed by investor and professor, Benjamin Graham, often referred to as the "father of value investing". Published in his book, The Intelligent Investor, Graham devised the formula for investors to be able to quickly determine how rationally priced their stocks were. As with any valuation formula, the final number is not designed to give a true value of a stock, but only to approximate its range of possible values.
Note that Graham never intended this formula to be used to evaluate stocks.
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