Read Graham and PEG screens and their sensitivity

1. Graham: match the earnings and book-value basis

Choose the explicitly named historical Graham-number variant. Supply your positive three-year average earnings per common share and the latest reported common-share book equity per share. Both must refer to the same comparable share basis and currency. Annual earnings from a single year are not the three-year average. The application does not fetch issuer statements, choose a sector or certify that your accounting inputs are comparable. Select suitability yourself; positive numbers alone do not establish it. Unknown or unsuitable comparability produces no screening value.

The displayed formula is the square root of 22.5 multiplied by average EPS and book value per share. The historical combined P/E and P/B limit explains the multiplier; it is not a current market benchmark. For an explicitly hypothetical EPS of 2 and book value of 20, the radicand is 900 and the screening number is 30 in the chosen currency. This arithmetic does not check the other defensive-investor criteria or establish a company’s intrinsic value.

2. PEG: keep current earnings separate from expected growth

Use current base-year EPS, the explicit growth-screen variant, your chosen horizon from one to ten years and your comparability assertion. Enter three independent growth percentages and three independent positive PEG targets for Bear, Base and Bull. For ten percent growth, enter 10, not 0.1. Growth must be positive and at most 100 percent. The scenario labels establish neither probability nor a ranking: you choose all six assumptions, and a PEG target does not default to 1 or come from your price.

The selected PEG multiplied by growth in percentage units gives model P/E; current EPS multiplied by that P/E gives the screening value. Hypothetical EPS 2, growth 5 percent and selected PEG 0.8 yield P/E 4 and value 8. The horizon describes the expected-growth assumption and does not multiply the price or compound EPS again. Supplying forward EPS would mix a different time basis into this model. Risk, payout policy and the quality of the growth assumption can affect comparability; the application does not verify those issuer facts.

3. Read your optional price comparison carefully

Your comparison price is a separate, optional positive input in the same currency. Leaving it unknown does not invalidate a supported standalone screening calculation. If you enable the field, supply a positive amount; a blank price is not zero. The difference relative to your price divides the model-minus-price gap by your price. The price gap relative to the model divides it by the model value. These denominators are different. A hypothetical model 30 and own price 15 therefore give 100 percent and 50 percent respectively; neither percentage is a realized investment return.

4. Explore explicit sensitivity instead of a hidden default range

First calculate a supported parent model. Then supply all three row assumptions and all three column assumptions yourself. Graham varies average EPS against book value. PEG varies growth percentages against selected PEG targets while holding the accepted current EPS, horizon, currency and suitability fixed. The nine cells are combinations of your choices, not nine provider forecasts. Values keep your order; repeated assumptions are allowed and remain repeated. No automatic plus-or-minus range, sorting or inferred middle scenario replaces your inputs.

Calculate sensitivity is an explicit action. Editing an axis hides the previous matrix until you calculate again. Editing or recalculating the parent resets its separate sensitivity panel. Invalid axes refuse the request. A cell exceeding the numerical budget is explicitly unavailable, with no guessed zero. Read row and column units with each value; changing two assumptions together does not identify which one caused the whole difference. The matrix creates no trades, account entries, probabilities, expected return or consensus among valuation methods.

5. Keep the result’s limits visible

Long displayed decimals marked ≈ are rounded presentation; exact working strings and declared numerical precision remain in detail. Inputs are your assumptions, with no invented provider provenance, issuer approval or market timestamp. The source links on the calculators explain the historical Graham relationship and the selected PEG approach; they do not certify your company inputs. Missing methods are not silently averaged into a six-model valuation. Use the breakdown to understand your model, and revisit weak assumptions rather than interpreting a single screening number as a buy instruction.

A time labelled Calculated on this device records your current explicit calculation. It is separate from the report periods behind your assumptions, a source publication date and a saved original’s creation time. No issuer timestamp is inferred from that local clock.