Graham Holdings (GHC) Q3 Earnings Leave Valuation Questions In Focus

Graham Holdings shares barely budged after the Q3 2026 release, ticking up about 0.6% even though the past week has been slightly in the red. On the surface, a quarterly basic earnings per share figure of US$17.89 and net income of US$75.11 million look underwhelming next to the stock’s four digit price tag. The real story sits on a longer time frame. Over the last year the business has run with a trailing P/E of 9.9x and a wide gap to one discounted cash flow fair value estimate, which keeps the valuation question front and center.

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Q3 2026 Graham Holdings Earnings Summary

• Revenue (Q3 2026 vs. Q3 2025): US$1,326.0 million vs. US$1,278.9 million (up about 3.7%)

• Net Income (Excl. Extra Items, Q3 2026 vs. Q3 2025): US$75.1 million vs. US$122.2 million (down about 38.5%)

• Basic EPS (Q3 2026 vs. Q3 2025): US$17.89 per share vs. US$28.19 per share (down about 36.5%)

• Trailing 12-Month Net Income (Excl. Extra Items, Q3 2026 vs. Q3 2025): US$493.2 million vs. US$727.9 million (down about 32.2%)

Ask Charlie what makes Graham Holdings look this cheap.

Graham Holdings Bull Case Meets Mixed Earnings

For anyone leaning optimistic on Graham Holdings, the top line offers some support. Revenue in Q3 rose from US$1,278.9 million to US$1,326.0 million, which fits the idea of a broad portfolio still pulling in more business overall. Kaplan’s steady product rollouts in high stakes exams and test prep also reinforce the view that the education arm remains active and commercially relevant, giving the diversified structure at least one segment with visible momentum even as the wider group absorbs bumps elsewhere.

Profit Pressure Keeps Graham Holdings Bears Engaged

The profit trend gives the cautious camp plenty to point to. Net income excluding extra items fell from US$122.2 million to US$75.1 million in the quarter, with basic EPS dropping from US$28.19 to US$17.89. On a trailing 12 month basis, earnings excluding extra items declined from US$727.9 million to US$493.2 million. That pattern challenges any simple resilience story for Graham Holdings and suggests that portfolio diversification does not currently shield shareholders from pressure on underlying profitability.

Reveal where the surface looks calm for Graham Holdings, but the multi year models start to disagree, and access the revenue, EPS, and free cash flow analyst estimates for Graham Holdings

Hunt For Mispriced Earnings Power

Graham Holdings just showed how a busy quarter and a near flat share price can still leave big questions about valuation. The real opportunity is finding stocks that could be undervalued before the market corrects them.

• Company 1 – 31% below our estimate – builds large dedicated AI superclusters that heavy compute customers use alongside existing cloud commitments for redundancy.

• Company 2 – 35% below our estimate – sells GPU platforms and software stacks enterprises choose when scaling purpose-built AI data centres over general compute upgrades.

• Company 3 – 46% below our estimate – converts a near record backlog of complex public infrastructure projects into managed construction work with embedded dispute and cost controls.

That is three of the list. See every one of the 29 undervalued companies on it →

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include GHC.

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