Graham Number Intrinsic Value
Fair Value Calculator
Select Valuation Method
PKR
Trailing 12 months earnings per share — published figurePKR
From balance sheet / ratios — published figureFill all 0/3 fields to unlock
When a blue-chip name like HUBC, ENGRO, or FFC sells off, value investors want one question answered: is it actually cheap, or just falling? This Fair value calculator gives you three independent ways to answer that. The classic Graham formula calculator uses only EPS and Book Value, so it needs no assumptions about the future. The Peter Lynch fair value tool instead weighs a stock's P/E against its growth and dividend yield, better suited to growth names. The most rigorous of the three, our Discounted Cash Flow calculator for Pakistani stocks, projects future free cash flows and discounts them back to today — for the discount rate, many local investors anchor to the current SBP KIBOR rate or 10-year PIB (Pakistan Investment Bond) yield plus a risk premium, rather than a generic global assumption. Running a stock through more than one method is the fastest way to sanity-check whether a "cheap" price is a genuine opportunity or a value trap.
Tell us what happened or suggest what you would like us to add.
Fair value is your estimate of what a stock is actually worth, based on the company's earnings, assets, and cash flow — as opposed to whatever price the market happens to be trading it at today. On the Pakistan Stock Exchange, this distinction matters more than most investors realize. Thin trading volumes in many counters mean prices can swing 5-10% on light volume with no change in the underlying business. Sentiment around interest rate decisions, currency movement, or political news often pushes prices away from fundamentals for weeks at a time. And because the market is concentrated in a handful of sectors — banks, cement, fertilizer, and E&P — sector-wide sentiment can drag even fundamentally sound stocks down (or inflate weak ones) alongside their peers. Calculating fair value gives you a reference point that isn't affected by any of this. When a stock trades well below your fair value estimate, that's a signal worth investigating — not necessarily a reason to buy, but a reason to look closer. When it trades well above, it's a reason for caution, even if the price momentum feels good.
Most fair value calculators — on PSX-focused sites and international ones alike — give you one valuation method and call it done. This tool runs three independent methods side by side: the Graham Number (a conservative floor based on earnings and book value), the Peter Lynch / PEGY approach (which weighs growth and dividend yield together, useful for PSX growth names), and a full Discounted Cash Flow model with the discount rate anchored to current KIBOR or PIB yields rather than a generic assumption pulled from a US textbook. Seeing where the three methods agree — or where they diverge and why — tells you far more than any single number can. The tool also pulls available data (EPS, book value, current price) directly from the PSX database instead of asking you to hunt it down and type it in manually. Where data isn't available for a given stock, it flags the gap explicitly rather than silently defaulting to zero, so you're never looking at a fair value estimate built on a hidden assumption you didn't know was there.
The Graham Number is a formula developed by Benjamin Graham to estimate a stock's fair or intrinsic value using only its earnings and book value. It is calculated as the square root of (22.5 × EPS × Book Value Per Share). If the current market price is below this number, the stock is generally considered undervalued relative to its fundamentals.
Enter the stock's Current Market Price, TTM (trailing twelve months) EPS, and Book Value Per Share into the Graham Number method above. These figures are publicly available for every PSX-listed company on sites like sarmaaya.pk — use the Quick Lookup search bar to jump straight to any symbol's data page.
Margin of safety is the percentage gap between a stock's calculated intrinsic (fair) value and its current market price. A larger positive margin of safety means the stock is trading further below its estimated fair value, giving a value investor more cushion against valuation errors or market downturns.
According to the classic Graham methodology, yes — a market price below the calculated Graham Number suggests the stock may be undervalued relative to its earnings and book value. This tool automatically flags each result as "Undervalued" or "Overvalued" based on that comparison, though it should be used alongside other analysis, not in isolation.
The Graham Number was originally designed for stable, asset-heavy, earnings-positive companies, so it can understate fair value for high-growth or asset-light businesses, and may be less reliable for banks and financial institutions with unusual balance sheet structures. It works best as one input among several valuation methods rather than a standalone verdict.
TTM EPS and Book Value Per Share for any PSX-listed company are published on financial data platforms such as sarmaaya.pk, the PSX website, and company financial statements. Use the Quick Lookup tool on this page, or tap the guide icon for a step-by-step AI-assisted method to pull these numbers instantly.
Peter Lynch's approach compares a stock's P/E ratio to its growth rate. This calculator applies the PEGY variant, calculating Fair Value as EPS × (Expected EPS Growth Rate + Dividend Yield). The resulting PEGY ratio — current P/E divided by growth-plus-yield — is traditionally read as attractive below 1.0 and expensive above 1.0.
A DCF valuation estimates intrinsic value by projecting a company's future free cash flows and discounting them back to today's value using a required rate of return. This calculator uses a simplified 2-stage model: five years of explicit growth followed by a terminal value based on a long-run growth assumption.
Free Cash Flow per Share is not published directly on typical PSX data sites like sarmaaya.pk. Calculate it yourself from the company's Cash Flow Statement, available in its quarterly or annual report: subtract Capital Expenditure from Operating Cash Flow, then divide the result by the number of shares outstanding.
Growth rate is an assumption you make, not a published figure. A common starting point is the company's own historical 3-5 year EPS or free cash flow growth rate (calculated from past annual reports), adjusted for your own view of whether that pace is likely to continue, slow down, or accelerate going forward.
Both are assumptions, not published data points. A discount rate of roughly 12%-18% is a common starting range for PSX equities given local risk-free rates, while a terminal growth rate of 3%-5% — in line with long-run inflation and GDP growth — is a typical assumption for the value beyond Year 5. Small changes to either figure can meaningfully shift the result, so it is worth testing a couple of scenarios.
The Graham Number works well for stable, earnings-positive, asset-heavy companies using only data that is freely available online. The Peter Lynch method suits growth-oriented stocks where earnings growth matters more than book value. DCF is the most rigorous of the three but depends entirely on your own cash flow and growth assumptions — running a stock through more than one method is a good way to sanity-check the result.