Benjamin Graham

Benjamin Graham (May 8, 1894–September 21, 1976) was an American economist and investor. He was born in London, graduated from Columbia University at the age of 20, and became Warren Buffett’s teacher in 1950.

Graham is the author of The Intelligent Investor, a seminal book on value investing that Warren Buffett called “by far the best book on investing ever written.” Buffett was just one of Graham’s disciples. Graham also taught or influenced Mario Gabelli, John Neff, Michael Price and John Bogle. 

Why do we have an investment newsletter named after Benjamin Graham at Cabot? First, Graham is widely celebrated as “The Father of Value Investing.” He created the process of evaluating companies to find their intrinsic value. Graham could thereby purchase companies with undervalued stock prices and avoid buying companies with over-inflated prices.

Cabot Benjamin Graham Value Investor recommends stocks based on the Benjamin Graham investing system. Graham analyzed every company according to seven factors: profitability, stability, earnings growth, financial position, book value, dividends and price history. He analyzed every potential investment based on these factors to determine which companies were clearly undervalued.

A key concept of the Benjamin Graham system is the Margin of Safety, which is achieved by buying a stock only when it falls below its maximum buy price. That price is calculated using the metrics that determine the intrinsic value of a company. Strict adherence to the rule of buying only below the maximum buy price will minimize potential losses while maximizing potential profits.

In essence, Graham developed a whole new approach to investing based on principles of measuring a stock’s price versus its intrinsic value. For nearly a full century, that approach has beaten the market. Since 1926, the Benjamin Graham value investing approach has achieved average annual returns of 20% a year.

Using Graham’s principles, our value investing expert J. Royden Ward has achieved similar returns for his subscribers. Since Cabot Benjamin Graham Value Investor's inception in 2002, Roy’s recommendations have generated a 258% return for his readers—more than double the 117% return in the S&P 500 over that time span.

Cabot Benjamin Graham Value Investor caters to conservative investors looking for low-risk, high-quality stocks that other investors have overlooked. The Investor adheres to Graham’s principles of providing a margin of safety by recommending only stocks that are clearly trading below their intrinsic value.

Benjamin Graham was a pioneer of financial analysis who is still recognized today as one of Wall Street’s most successful investors. By embracing his core principles of value investing, we have achieved Graham-like returns for our subscribers and expect to continue doing so for years to come 

Analysts Center

Our analysts regularly share content from their premium advisories. See a sampling of our analysts’ unique takes on current market conditions and how they impact a wide range of investments.


Benjamin Graham's Seven Criteria for Picking Value Stocks

Here are Benjamin Graham's seven time-tested criteria to identify strong value stocks.»

Short Biography of Benjamin Graham

Benjamin Graham was born in London in 1894. (His original name was Grossbaum, but he changed it as a young man, the better to fit into the Wall Street environment.)»

Some Value Investing History

The investment principles taught by Graham at Columbia University became legend in the field of professional stock analysis.»

Benjamin Graham's Mr. Market

One of Benjamin Graham's favorite parables is that of Mr. Market. Graham refers to him several times in his book, The Intelligent Investor.»

Warren Buffett - Seven Value Investing Guidelines

Warren Buffett learned well from Benjamin Graham, and made one successful investment after another. These seven guidelines will help you to invest like Warren Buffett.»

Stock Picks

Mattel

Turnaround situations can be a great place to find relatively low risk, high paying dividend stocks—and they’re usually a great value to boot.

Corrections Corp. of America

This REIT has paid dividends since 2012 and increased the dividend in each of the past three years.

Philip Morris

This non-cyclical consumer stock offers consistency and high dividends.

Cabot Wealth Advisory

Options Trading Lesson: The Company Is Not the Stock

By Jacob Mintz on May 03, 2016

Divorcing one’s personal beliefs from a company’s products and its stock can be extremely challenging. However, a look at the stock’s performance and options trading can go a long way to helping investors avoid their personal biases.Read More >

Burger Stocks: The Bubble Has Burst, and One Clear Winner Has Emerged

By Timothy Lutts on May 02, 2016

Burger stocks exploded last year. It started with the IPO of Shake Shack (SHAK) in January, an offering that was priced at 21, but began trading at 47. It was fueled by lots of hype about trendy private chains, like Five Guys, In-N-Out Burger, Whataburger, Umami Burger and Iron Chef Bobby Flay’s Bobby’s Burger Palace.Read More >

Another Dire Stock Market Prediction: Whoopee!

By Paul Goodwin on April 29, 2016

McKinsey & Company is a big consulting firm—9,000 consultants and 2,000 researchers around the world—that companies hire when they need advice. I get research reports from McKinsey every once in a while, and they’re usually beautifully designed, well written and interesting in an abstract kind of way. The report that reached my email in-box on Thursday had the intriguing title: “Why investors may need to lower their sights.” (Note how the avoidance of Capital Letters makes things a little edgier; that’s the McKinsey Difference!) It took seven people to write this little piece of analysis, so you know it must contain really valuable information. Read More >