NYSE:GHC

Stock Analysis Report

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Executive Summary

Graham Holdings Company, through its subsidiaries, operates as a diversified education and media company worldwide. More Details

Rewards

Trading at 63.1% below our estimate of its fair value

Risk Analysis

No risks detected for GHC from our risk checks.


Snowflake Analysis

Undervalued with adequate balance sheet.


Similar Companies

Share Price & News

How has Graham Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: GHC is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: GHC's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

-2.6%

GHC

-3.3%

US Consumer Services

0.7%

US Market


1 Year Return

-28.3%

GHC

31.6%

US Consumer Services

22.2%

US Market

Return vs Industry: GHC underperformed the US Consumer Services industry which returned 34.5% over the past year.

Return vs Market: GHC underperformed the US Market which returned 22.7% over the past year.


Shareholder returns

GHCIndustryMarket
7 Day-2.6%-3.3%0.7%
30 Day14.4%3.5%11.8%
90 Day5.0%-1.8%8.6%
1 Year-27.3%-28.3%32.0%31.6%25.0%22.2%
3 Year-18.6%-21.1%57.4%51.6%49.4%39.5%
5 Year-3.9%-8.6%236.7%212.2%100.2%78.1%

Long-Term Price Volatility Vs. Market

How volatile is Graham Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Graham Holdings undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: GHC ($450) is trading below our estimate of fair value ($1219.17)

Significantly Below Fair Value: GHC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: GHC is good value based on its PE Ratio (11.3x) compared to the US Consumer Services industry average (23.3x).

PE vs Market: GHC is good value based on its PE Ratio (11.3x) compared to the US market (19.4x).


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate GHC's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: GHC is good value based on its PB Ratio (0.7x) compared to the US Consumer Services industry average (2.2x).


Next Steps

Future Growth

How is Graham Holdings forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

60.8%

Forecasted Consumer Services industry annual growth in earnings


In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as Graham Holdings has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.


Next Steps

Past Performance

How has Graham Holdings performed over the past 5 years?

28.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: GHC has high quality earnings.

Growing Profit Margin: GHC's current net profit margins (7.3%) are lower than last year (8.3%).


Past Earnings Growth Analysis

Earnings Trend: GHC's earnings have grown significantly by 28.5% per year over the past 5 years.

Accelerating Growth: GHC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: GHC had negative earnings growth (-12.8%) over the past year, making it difficult to compare to the Consumer Services industry average (11.9%).


Return on Equity

High ROE: GHC's Return on Equity (6.4%) is considered low.


Next Steps

Financial Health

How is Graham Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: GHC's short term assets ($1.5B) exceed its short term liabilities ($915.5M).

Long Term Liabilities: GHC's short term assets ($1.5B) do not cover its long term liabilities ($1.6B).


Debt to Equity History and Analysis

Debt Level: GHC's debt to equity ratio (16.6%) is considered satisfactory.

Reducing Debt: GHC's debt to equity ratio has increased from 15.5% to 16.6% over the past 5 years.

Debt Coverage: GHC's debt is well covered by operating cash flow (61.6%).

Interest Coverage: GHC's interest payments on its debt are well covered by EBIT (11.5x coverage).


Balance Sheet


Next Steps

Dividend

What is Graham Holdings's current dividend yield, its reliability and sustainability?

1.29%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: GHC's dividend (1.29%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.48%).

High Dividend: GHC's dividend (1.29%) is low compared to the top 25% of dividend payers in the US market (4.14%).


Stability and Growth of Payments

Stable Dividend: GHC's dividend payments have been volatile in the past 10 years.

Growing Dividend: GHC's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (14.4%), GHC's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.2yrs

Average management tenure


CEO

Tim O’Shaughnessy (39 yo)

5.08yrs

Tenure

US$1,470,860

Compensation

Mr. Timothy J. O’Shaughnessy, also known as Tim, has been the President, Chief Executive Officer f Graham Holdings Company since November 3, 2014 and serves as itsoversees investments and acquisitions and ...


CEO Compensation Analysis

Compensation vs Market: Tim's total compensation ($USD1.47M) is below average for companies of similar size in the US market ($USD4.18M).

Compensation vs Earnings: Tim's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Timothy O’Shaughnessy
President5.08yrsUS$1.47m1.47%
$ 33.2m
Wallace Cooney
Senior VP of Finance & CFO3.67yrsUS$1.51m0.040%
$ 900.0k
Nicole Maddrey
Senior VP5.67yrsUS$1.32m0.053%
$ 1.2m
Denise Demeter
VP & Chief Human Resources Officer6.25yrsUS$1.23m0.033%
$ 742.6k
Andrew Rosen
Executive Vice President6.67yrsUS$8.18m0.62%
$ 14.0m
Marcel Snyman
VP & Chief Accounting Officer2.92yrsno datano data
Scot Gillespie
CTO & VP3.92yrsno datano data
Shailesh Prakash
Chief Information Officer & Executive VPno datano datano data
Pinkie Mayfield
VP of Corporate Affairs & Chief Communications Officer5.92yrsno datano data
Miki King
Chief Marketing Officer2.08yrsno datano data
Micah Gelman
Head of Video & Senior Editorno datano datano data
Annie Granatstein
Head of WP Brandstudio5.25yrsno datano data

5.2yrs

Average Tenure

56yo

Average Age

Experienced Management: GHC's management team is seasoned and experienced (5.2 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Timothy O’Shaughnessy
President5.08yrsUS$1.47m1.47%
$ 33.2m
G. Wagoner
Independent Director10.5yrsUS$174.00k0.020%
$ 449.9k
Donald Graham
Chairman of the Board27.25yrsUS$362.17k11.21%
$ 252.5m
Anne Mulcahy
Independent Director12.92yrsUS$170.00k0.0041%
$ 91.7k
Thomas Gayner
Independent Director13.92yrsUS$190.00k0.11%
$ 2.4m
Lee Bollinger
Independent Director13.58yrsUS$150.00k0.023%
$ 517.5k
Jack Markell
Independent Director3.58yrsUS$170.00k0.0022%
$ 49.6k
Lawrence Thompson
Independent Director9.5yrsUS$150.00k0.0015%
$ 34.2k
Christopher Davis
Lead Independent Director9.58yrsUS$190.00k0.10%
$ 2.2m
Katharine Weymouth
Independent Director10.25yrsUS$150.00k0.051%
$ 1.1m

10.4yrs

Average Tenure

63yo

Average Age

Experienced Board: GHC's board of directors are seasoned and experienced ( 10.4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Graham Holdings Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Graham Holdings Company
  • Ticker: GHC
  • Exchange: NYSE
  • Founded: 1877
  • Industry: Education Services
  • Sector: Consumer Services
  • Market Cap: US$2.253b
  • Shares outstanding: 5.01m
  • Website: https://www.ghco.com

Number of Employees


Location

  • Graham Holdings Company
  • 1300 North 17th Street
  • 17th Floor
  • Arlington
  • Virginia
  • 22209
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
GHCNYSE (New York Stock Exchange)YesClass B Common SharesUSUSDOct 1971
WPOBDB (Deutsche Boerse AG)YesClass B Common SharesDEEUROct 1971

Biography

Graham Holdings Company, through its subsidiaries, operates as a diversified education and media company worldwide. It provides test preparation services and materials, as well as data science education, a...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/12/03 00:53
End of Day Share Price2020/12/02 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.