In a market where many stocks are priced for perfection, Graham Holdings Co. (NYSE: GHC) is trading at what some analysts see as a steep discount to its true value.
Shares closed Thursday, August 7, 2025 at $959.60, down 0.65% on the day, but well below estimates of the company’s sum-of-the-parts worth, suggesting there may be significant upside for patient investors.
Graham Holdings, the former parent of The Washington Post, now operates as a diversified holding company with interests spanning education (Kaplan), healthcare, broadcast television, auto dealerships, restaurants, Framebridge (custom framing), and a sizable investment portfolio.
According to analysts at Barron’s, the combined value of these divisions, plus the company’s overfunded pension plan, could be worth more than $1,500 per share if valued separately. That’s more than 55% above where the stock trades today.
Nevertheless, the company’s balance sheet is equally compelling. As of mid-2025, Graham Holdings reported over $1.1 billion in cash and investments, including roughly $600 million in Berkshire Hathaway shares. Against this, it carries around $800 million in debt. Its defined-benefit pension plan is overfunded by an estimated $1 billion, adding hidden value that doesn’t show up in the stock price.
This strong liquidity gives the company the flexibility to pursue acquisitions, repurchase shares, or unlock value through spinoffs, something it has done in the past, such as its 2015 divestiture of Cable One.
Financial performance is on an upswing. In Q2 2025, the education and healthcare divisions saw over 40% year-on-year revenue growth, helping push adjusted operating cash flow up 13% to $111.3 million.
For the first half of the year, adjusted net income came in at $26 per share, putting the company on pace to earn over $50 per share in 2025. Looking ahead, analysts forecast earnings could reach $80+ per share by 2027 as underperforming units like Framebridge improve and other divisions expand.
Despite these positives, Graham Holdings trades at a trailing P/E of just 6.2, a forward P/E of around 17, and an EV/EBITDA multiple of only 3.8. Its price-to-book ratio sits below 1.0, indicating the market values the company for less than the worth of its net assets.
These figures suggest Wall Street may be overlooking the company’s growth potential, especially when compared with peers in the education, media, and healthcare sectors, which often trade at higher multiples.
Potential triggers for a re-rating include a spinoff of the broadcast TV division, monetization of its Berkshire Hathaway stake, operational turnaround in the Framebridge unit, and increased investor awareness of the pension surplus and cash-rich position.
Given management’s track record of strategic restructuring, investors believe such moves could surface value in the next 12–24 months.
At current levels, Graham Holdings offers a rare combination of financial strength, undervaluation, and growth potential. With a diverse portfolio of profitable businesses, an overfunded pension, and a market price far below its estimated intrinsic value, the stock looks poised for long-term gains.
