Benjamin Graham laid the groundwork for value investing through his methodical strategies for spotting undervalued securities, principles that remain relevant for modern investors. His most famous protégé, Warren Buffett, exemplifies how Graham’s teachings can generate enduring prosperity. Graham’s methodology revolves around finding solid, mature businesses selling for less than their true worth while steering clear of speculative, unproven investments.
Core Investment Principles
Graham favored companies with established performance histories over those dependent on optimistic projections. This prudent strategy prioritizes capital preservation by seeking substantial gaps between market valuation and actual asset worth—his concept of “margin of safety.”
Validea’s Implementation of Graham’s Strategy
Validea has converted Graham’s investment philosophy into an organized assessment framework that evaluates prospective investments through four key dimensions:
Business Fundamentals
The selection criteria demands companies generate minimum annual revenues of $340 million, guaranteeing sufficient operational scale. Prospects must also show steady profitability across five straight years and generally function within mature, stable industries rather than nascent technology sectors.
Balance Sheet Health
Robust financial positions are mandatory, with current assets outweighing current liabilities by at least 2-to-1. Moreover, working capital must exceed the firm’s total long-term debt commitments.
Performance and Stability
Businesses must exhibit earnings expansion of no less than 30% across a decade. To smooth out short-term volatility, the framework analyzes three-year average earnings instead of individual annual figures.
Price Metrics
The approach mandates that three-year average price-to-earnings multiples stay under 15. Additionally, the total of price-to-earnings and price-to-book multiples must not surpass 22, guaranteeing reasonable acquisition costs relative to underlying business fundamentals.
Discover how Validea’s models can help you identify high-quality, long-term investments, even in changing market conditions. Visit Validea.com to access in-depth stock analysis and tools designed to emulate proven investment principles. Take a Free Trial Today!
Here are the top 10 stocks using Validea’s Benjamin Graham strategy for August of 2025.
| Ticker | Company Name | Value Investor | Price | Market Cap ($mil) | PE Ratio | Price/ Sales | Relative Strength | Price/ Book | Price/ Cash Flow | Dividend Yield |
|---|---|---|---|---|---|---|---|---|---|---|
| BCC | BOISE CASCADE CO | 100 | $84.50 | $3,155 | 12.4 | 0.5 | 29 | 1.5 | 7.6 | 0.8% |
| BG | BUNGE GLOBAL SA | 100 | $82.37 | $16,479 | 8.2 | 0.3 | 40 | 1.0 | 8.6 | 3.3% |
| CALM | CAL-MAINE FOODS INC | 100 | $114.20 | $5,538 | 4.6 | 1.3 | 86 | 2.2 | 4.2 | 5.9% |
| SCVL | SHOE CARNIVAL INC | 100 | $20.46 | $559 | 8.6 | 0.5 | 19 | 0.9 | 5.7 | 2.7% |
| UVV | UNIVERSAL CORP | 100 | $55.39 | $1,378 | 13.5 | 0.5 | 60 | 0.9 | 7.3 | 5.9% |
| WB | WEIBO CORP (ADR) | 100 | $11.16 | $2,776 | 7.8 | 1.6 | 81 | 0.8 | 6.4 | 7.4% |
| WGO | WINNEBAGO INDUSTRIES INC | 86 | $34.46 | $966 | 0.4 | 25 | 0.8 | 21.7 | 3.8% | |
| WLK | WESTLAKE CORP | 86 | $82.75 | $10,612 | 0.9 | 23 | 1.0 | 9.5 | 2.5% | |
| TK | TEEKAY CORP LTD | 86 | $7.55 | $644 | 5.3 | 0.5 | 74 | 0.9 | 1.3 | 0.0% |
| TNK | TEEKAY TANKERS LTD | 86 | $44.60 | $1,540 | 5.3 | 1.5 | 36 | 0.8 | 4.0 | 2.2% |
Further Research
