NYSE:GHC

Stock Analysis Report

Executive Summary

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

Snowflake

Fundamentals

Excellent balance sheet and fair value.


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


Market Performance


7 Day Return

-2.3%

GHC

-0.05%

US Consumer Services

1.0%

US Market


1 Year Return

13.4%

GHC

25.0%

US Consumer Services

6.7%

US Market

Return vs Industry: GHC underperformed the US Consumer Services industry which returned 25% over the past year.

Return vs Market: GHC exceeded the US Market which returned 6.7% over the past year.


Share holder returns

GHCIndustryMarket
7 Day-2.3%-0.05%1.0%
30 Day-7.8%-0.9%-1.8%
90 Day-12.6%-1.9%-1.8%
1 Year14.4%13.4%25.5%25.0%9.1%6.7%
3 Year43.0%39.6%103.8%93.0%46.1%36.6%
5 Year55.9%-10.0%144.9%119.8%66.9%48.6%

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 based on future cash flows and its price relative to the stock market?

10.71x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Undervalued: GHC ($646.1) is trading above our estimate of fair value ($311.05)

Significantly Undervalued: GHC is trading above our estimate of fair value.


Price Based on Earnings

PE vs Industry: GHC is good value based on its PE Ratio (10.7x) compared to the Consumer Services industry average (26.2x).

PE vs Market: GHC is good value based on its PE Ratio (10.7x) compared to the US market (17.5x).


Price Based on Expected Growth

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


Price Based on Value of Assets

PB vs Industry: GHC is good value based on its PB Ratio (1.1x) compared to the US Consumer Services industry average (2.2x).


Next Steps

Future Growth

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

8.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Earnings vs Savings Rate: GHC's forecast earnings growth (8.9% per year) is above the savings rate (2.7%).

Earnings vs Market: GHC's earnings (8.9% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: GHC's earnings are forecast to grow, but not significantly.

Revenue vs Market: Insufficient data to determine if GHC's revenue is forecast to grow faster than the US market.

High Growth Revenue: Insufficient data to determine if GHC's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Estimates


Future Return on Equity

High Future ROE: Insufficient data to determine if GHC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Graham Holdings performed over the past 5 years?

-9.4%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: GHC's earnings have declined by -9.4% 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 (-2.1%) over the past year, making it difficult to compare to the Consumer Services industry average (5.5%).


Return on Equity

High ROE: GHC's Return on Equity (10.5%) is considered low.


Return on Assets

ROA vs Industry: GHC has a higher Return on Assets than the Consumer Services industry average last year.


Return on Capital Employed

ROCE Improving: GHC has improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is Graham Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: GHC's short term assets ($1.5B) exceeds its short term liabilities ($814.6M)

Long Term Liabilities: GHC's short term assets (1.5B) exceeds its long term liabilities (1.4B)


Debt to Equity History and Analysis

Debt Level: GHC's debt to equity ratio (18.3%) is considered satisfactory

Reducing Debt: GHC's debt to equity ratio has increased from 15.9% to 18.3% over the past 5 years.

Debt Coverage: GHC's debt is well covered by operating cash flow (35.9%).

Interest Coverage: GHC's interest payments on its debt are well covered by EBIT (15.5x coverage).


Balance Sheet

Inventory Level: GHC has a low level of unsold assets or inventory.

Debt Coverage by Assets: GHC's debt is covered by short term assets (assets are 2.665740x debt).


Next Steps

Dividend

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

0.86%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Graham Holdings before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company0.9%marketbottom25%1.5%markettop25%3.8%industryaverage1.4%forecastin3Yearsn/a

Current dividend yield vs market & industry


Dividend Yield and Payments Analysis

Notable Dividend: GHC's dividend (0.86%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.46%).

High Dividend: GHC's dividend (0.86%) is low compared to the top 25% of dividend payers in the US market (3.77%).

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 (9%), 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

What is the CEO of Graham Holdings's salary, the management and board of directors tenure and is there insider trading?

4.0yrs

Average management tenure


CEO

Tim O’Shaughnessy (38yo)

3.9yrs

Tenure

US$2,983,209

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 ($USD2.98M) is below average for companies of similar size in the US market ($USD5.11M).

Compensation vs Earnings: Tim's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.


Management Age and Tenure

4.0yrs

Average Tenure

49yo

Average Age

Experienced Management: GHC's management team is considered experienced (4 years average tenure).


Board Age and Tenure

9.2yrs

Average Tenure

62yo

Average Age

Experienced Board: GHC's board of directors are considered experienced (9.2 years average tenure).


Insider Trading

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


Ownership Breakdown


Management Team

  • Andy Rosen (58yo)

    Executive Vice President

    • Tenure: 5.5yrs
    • Compensation: US$4.41m
  • Wally Cooney (56yo)

    Senior VP of Finance & CFO

    • Tenure: 2.8yrs
    • Compensation: US$1.75m
  • Nicole Maddrey (54yo)

    Senior VP

    • Tenure: 4.5yrs
    • Compensation: US$1.63m
  • Pinkie Mayfield

    VP of Corporate Affairs & Special Assistant to the Chairman

    • Tenure: 4.8yrs
  • Tim O’Shaughnessy (38yo)

    President

    • Tenure: 3.9yrs
    • Compensation: US$2.98m
  • Kristine Coratti

    Vice President of Communications

    • Tenure: 4.9yrs
  • Marcel Snyman (44yo)

    VP & Chief Accounting Officer

    • Tenure: 1.8yrs
  • Jake Maas (42yo)

    Senior VP of Planning & Development

    • Tenure: 4yrs
    • Compensation: US$1.43m
  • Shailesh Prakash

    Chief Information Officer & Executive VP

    • Tenure: 0yrs
  • Scot Gillespie

    CTO & VP

    • Tenure: 2.8yrs

Board Members

  • Rick Wagoner (66yo)

    Director

    • Tenure: 9.3yrs
    • Compensation: US$178.00k
  • Don Graham (74yo)

    Chairman of the Board

    • Tenure: 26.1yrs
    • Compensation: US$362.17k
  • Anne Mulcahy (67yo)

    Director

    • Tenure: 11.8yrs
    • Compensation: US$170.00k
  • Tom Gayner (58yo)

    Director

    • Tenure: 12.8yrs
    • Compensation: US$190.00k
  • Lee Bollinger (72yo)

    Director

    • Tenure: 12.4yrs
    • Compensation: US$150.00k
  • Jack Markell (58yo)

    Director

    • Tenure: 2.4yrs
    • Compensation: US$150.00k
  • Larry Thompson (74yo)

    Director

    • Tenure: 8.3yrs
    • Compensation: US$150.00k
  • Chris Davis (54yo)

    Lead Director

    • Tenure: 8.4yrs
    • Compensation: US$190.00k
  • Katharine Weymouth (52yo)

    Director

    • Tenure: 9.1yrs
    • Compensation: US$150.00k
  • Tim O’Shaughnessy (38yo)

    President

    • Tenure: 3.9yrs
    • Compensation: US$2.98m

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$3.434b
  • Shares outstanding: 5.31m
  • 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 Analysis2019/10/14 01:32
End of Day Share Price2019/10/11 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.

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