--- title: "Meaning & Key Takeaway of: The only thing you should do with pro…" description: "\"The only thing you should do with pro forma earnings is ignore them.\" — Benjamin Graham" image: "https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg" --- # The only thing you should do with pro forma earnings is… ![“The only thing you should do with pro forma earnings is ignore them.” quote by Benjamin Graham](https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg) [Download](https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg) [Open image](https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg) > “The only thing you should do with pro forma earnings is ignore them.” [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) ## About This Quote This interpretation was drafted with AI assistance. It is one reading of the quote, not the author's own explanation. Pro forma earnings are artificial figures that can mislead investors; the prudent approach is to disregard them in financial analysis. **In simple terms:** Ignore artificial earnings numbers. Key Takeaway Focus on real cash flow and fundamentals. Themes finance investment analysis skepticism valuation Mood analytical cautious pragmatic Type financial educational When to use this quote - stock analysis - investment decisions - financial reporting Key Concepts earnings quality financial statements risk management Questions to Reflect On - How do you differentiate useful adjustments? - What metrics do you trust most? A Different Perspective Pro forma data can sometimes reveal useful trends. ★ ★ ★ ★ ★ No ratings yet [Earnings](https://sms4smile.com/quotes/about/earnings/) [Investing](https://sms4smile.com/quotes/about/investing/) ## Related quotes > [The concept of paying one-hundred-and-something times earnings for any company for me is just anathema. Having said that, at the end of the day,…](https://sms4smile.com/quotes/paul-tudor-jones/the-concept-of-paying-one-hundred-and-something-times-earnings-for/) [Paul Tudor Jones](https://sms4smile.com/quotes/author/paul-tudor-jones/) > [Most look at earnings and earnings potential, well I can't get into that game.](https://sms4smile.com/quotes/walter-schloss/most-look-at-earnings-and-earnings-potential-well-i-can-t-get-into/) [Walter Schloss](https://sms4smile.com/quotes/author/walter-schloss/) > [Calculate "owner earnings" to get a true reflection of value.](https://sms4smile.com/quotes/warren-buffett/calculate-owner-earnings-to-get-a-true-reflection-of-value/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [Think how weird profit margins are: We've got high unemployment and financial crises - and world record profit margins. People think the American market…](https://sms4smile.com/quotes/jeremy-grantham/think-how-weird-profit-margins-are-we-ve-got-high-unemployment-and/) [Jeremy Grantham](https://sms4smile.com/quotes/author/jeremy-grantham/) > [The earnings have been pretty good so far, but there's an ambiguity in the market about them, because you'll see Amazon or Microsoft disappointing…](https://sms4smile.com/quotes/hugh-s-johnson/the-earnings-have-been-pretty-good-so-far-but-there-s-an-ambiguity-in/) [Hugh S. Johnson](https://sms4smile.com/quotes/author/hugh-s-johnson/) > [Accounting does not make corporate earnings or balance sheets more volatile. Accounting just increases the transparency of volatility in earnings.](https://sms4smile.com/quotes/diane-garnick/accounting-does-not-make-corporate-earnings-or-balance-sheets-more/) Diane Garnick > [There is no limit on earnings.](https://sms4smile.com/quotes/earl-nightingale/there-is-no-limit-on-earnings/) [Earl Nightingale](https://sms4smile.com/quotes/author/earl-nightingale/) > [Earnings can change dramatically. Usually assets change slowly.](https://sms4smile.com/quotes/walter-schloss/earnings-can-change-dramatically-usually-assets-change-slowly/) [Walter Schloss](https://sms4smile.com/quotes/author/walter-schloss/) > [When I got my statement in January, I was worth $2.2 billion. Then I got another statement in August that said I was worth…](https://sms4smile.com/quotes/ted-turner/when-i-got-my-statement-in-january-i-was-worth-2-2-billion-then-i-got/) [Ted Turner](https://sms4smile.com/quotes/author/ted-turner/) > [I give a percentage of the earnings to the Motion Picture Home.](https://sms4smile.com/quotes/james-macarthur/i-give-a-percentage-of-the-earnings-to-the-motion-picture-home/) [James MacArthur](https://sms4smile.com/quotes/author/james-macarthur/) > [Observation over many years has taught us that the chief losses to investors come from the purchase of low-quality securities at times of good…](https://sms4smile.com/quotes/benjamin-graham/observation-over-many-years-has-taught-us-that-the-chief-losses-to/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Real investment risk is measured not by the percent that a stock may decline in price in relation to the general market in a…](https://sms4smile.com/quotes/benjamin-graham/real-investment-risk-is-measured-not-by-the-percent-that-a-stock-may/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Calculate a stock's price/earnings ratio yourself, using Graham's formula of current price divided by average earnings over the past three years.](https://sms4smile.com/quotes/benjamin-graham/calculate-a-stock-s-price-earnings-ratio-yourself-using-graham-s/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [It's nonsensical to derive a price/earnings ratio by dividing the known current price by unknown future earnings.](https://sms4smile.com/quotes/benjamin-graham/it-s-nonsensical-to-derive-a-price-earnings-ratio-by-dividing-the/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [To see how much a company is truly earning on the capital it deploys in its businesses, look beyond EPS to Return on Invested…](https://sms4smile.com/quotes/benjamin-graham/to-see-how-much-a-company-is-truly-earning-on-the-capital-it-deploys/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) ## More by Benjamin Graham > [The purpose of this book is to supply, in the form suitable for laymen, guidance in the adoption and execution of an investment policy.](https://sms4smile.com/quotes/benjamin-graham/the-purpose-of-this-book-is-to-supply-in-the-form-suitable-for-laymen/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [There is something paradoxical in the fact that by establishing an export market we subject our entire domestic production to the vagaries of that…](https://sms4smile.com/quotes/benjamin-graham/there-is-something-paradoxical-in-the-fact-that-by-establishing-an/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Those with the enterprise lack the money and those with the money lack the enterprise to buy stocks when they are cheap.](https://sms4smile.com/quotes/benjamin-graham/those-with-the-enterprise-lack-the-money-and-those-with-the-money/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [It must be fundamentally wrong to reduce production of food and fiber while one-third of our population is still ill fed and ill clothed.](https://sms4smile.com/quotes/benjamin-graham/it-must-be-fundamentally-wrong-to-reduce-production-of-food-and-fiber/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [The intelligent investor is a realist who sells to optimists and buys from pessimists.](https://sms4smile.com/quotes/benjamin-graham/the-intelligent-investor-is-a-realist-who-sells-to-optimists-and-buys/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Intelligent investment is more a matter of mental approach than it is of technique. A sound mental approach toward stock fluctuations is the touchstone…](https://sms4smile.com/quotes/benjamin-graham/intelligent-investment-is-more-a-matter-of-mental-approach-than-it-is/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Many progressive economists insist that gold is now in essentially the same position as silver and that the arguments the simon-pure gold advocates use…](https://sms4smile.com/quotes/benjamin-graham/many-progressive-economists-insist-that-gold-is-now-in-essentially/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [The art of investment has one characteristic that is not generally appreciated. A creditable, if unspectacular, result can be achieved by the lay investor…](https://sms4smile.com/quotes/benjamin-graham/the-art-of-investment-has-one-characteristic-that-is-not-generally/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [We have not known a single person who has consistently or lastingly make money by thus "following the market". We do not hesitate to…](https://sms4smile.com/quotes/benjamin-graham/we-have-not-known-a-single-person-who-has-consistently-or-lastingly/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [The essence of investment management is the management of risks, not the management of returns.](https://sms4smile.com/quotes/benjamin-graham/the-essence-of-investment-management-is-the-management-of-risks-not/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Wall Street people learn nothing and forget everything.](https://sms4smile.com/quotes/benjamin-graham/wall-street-people-learn-nothing-and-forget-everything/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [In security analysis the prime stress is laid upon protection against untoward events. We obtain this protection by insisting upon margins of safety, or…](https://sms4smile.com/quotes/benjamin-graham/in-security-analysis-the-prime-stress-is-laid-upon-protection-against/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Never buy a stock immediately after a substantial rise or sell one immediately after a substantial drop.](https://sms4smile.com/quotes/benjamin-graham/never-buy-a-stock-immediately-after-a-substantial-rise-or-sell-one/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [Observation over many years has taught us that the chief losses to investors come from the purchase of low-quality securities at times of good…](https://sms4smile.com/quotes/benjamin-graham/observation-over-many-years-has-taught-us-that-the-chief-losses-to/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) > [No matter how careful you are, the one risk no investor can ever eliminate is the risk of being wrong. Only by insisting on…](https://sms4smile.com/quotes/benjamin-graham/no-matter-how-careful-you-are-the-one-risk-no-investor-can-ever/) [Benjamin Graham](https://sms4smile.com/quotes/author/benjamin-graham/) [Explore all 229 Benjamin Graham quotes ](https://sms4smile.com/quotes/author/benjamin-graham/) ## More Earning quotes > [“This spending of the best part of one's life earning money in order to enjoy a questionable liberty during the least valuable part of…](https://sms4smile.com/quotes/henry-david-thoreau/this-spending-of-the-best-part-of-one-s-life-earning-money-in-order/) [Henry David Thoreau](https://sms4smile.com/quotes/author/henry-david-thoreau/) > [I was focused on The Hunger Games movie with my director, with the studio, and with the cast and crew. We all just focused…](https://sms4smile.com/quotes/nina-jacobson/i-was-focused-on-the-hunger-games-movie-with-my-director-with-the/) [Nina Jacobson](https://sms4smile.com/quotes/author/nina-jacobson/) > [I never knew an early-rising, hard-working, prudent man, careful of his earnings, and strictly honest who complained of bad luck.](https://sms4smile.com/quotes/henry-ward-beecher/i-never-knew-an-early-rising-hard-working-prudent-man-careful-of-his/) [Henry Ward Beecher](https://sms4smile.com/quotes/author/henry-ward-beecher/) > [Paul Revere earned his living as a silversmith. But what do we remember him for? His volunteer work. All activism is volunteering in that…](https://sms4smile.com/quotes/susan-j-ellis/paul-revere-earned-his-living-as-a-silversmith-but-what-do-we/) Susan J. Ellis > [If you don't like the idea that most of the money spent on lottery tickets supports government programs, you should know that most of…](https://sms4smile.com/quotes/robert-kiyosaki/if-you-don-t-like-the-idea-that-most-of-the-money-spent-on-lottery/) [Robert Kiyosaki](https://sms4smile.com/quotes/author/robert-kiyosaki/) > [Writing a book is a brilliant thing because once you've finished it, you've done it, and there's the potential for it to go on…](https://sms4smile.com/quotes/tom-hodgkinson/writing-a-book-is-a-brilliant-thing-because-once-you-ve-finished-it/) [Tom Hodgkinson](https://sms4smile.com/quotes/author/tom-hodgkinson/) > [These Americans are among the working poor with full-time jobs earning $5.15 an hour. Millions fall into this boat, even more when you consider…](https://sms4smile.com/quotes/marcy-kaptur/these-americans-are-among-the-working-poor-with-full-time-jobs/) [Marcy Kaptur](https://sms4smile.com/quotes/author/marcy-kaptur/) > [If we would have anything of benefit, we must earn it, and earning it become shrewd, inventive, ingenious, active, enterprising.](https://sms4smile.com/quotes/henry-ward-beecher/if-we-would-have-anything-of-benefit-we-must-earn-it-and-earning-it/) [Henry Ward Beecher](https://sms4smile.com/quotes/author/henry-ward-beecher/) > [After years of research, I discovered 25 differences in the work-life choices of men and women. All 25 lead to men earning more money,…](https://sms4smile.com/quotes/warren-farrell/after-years-of-research-i-discovered-25-differences-in-the-work-life/) [Warren Farrell](https://sms4smile.com/quotes/author/warren-farrell/) > [Recipients of transfers set a bad example for others, including their children, other relatives, and friends, who see that one can receive goods, services,…](https://sms4smile.com/quotes/robert-higgs/recipients-of-transfers-set-a-bad-example-for-others-including-their/) [Robert Higgs](https://sms4smile.com/quotes/author/robert-higgs/) > [Annual earnings in the fast-food industry are well below the income needed for self-sufficiency, and fast-food industry jobs are also much less likely than…](https://sms4smile.com/quotes/david-rolf/annual-earnings-in-the-fast-food-industry-are-well-below-the-income/) [David Rolf](https://sms4smile.com/quotes/author/david-rolf/) > [Accounting consequences do not influence our operating or capital-allocation decisions. When acquisition costs are similar, we much prefer to purchase $2 of earnings that…](https://sms4smile.com/quotes/warren-buffett/accounting-consequences-do-not-influence-our-operating-or-capital/) [Warren Buffett](https://sms4smile.com/quotes/author/warren-buffett/) > [“Invest in self-improvement, be it for learning, be it for earning.”](https://sms4smile.com/quotes/vikrmn-ca-vikram-verma/invest-in-self-improvement-be-it-for-learning-be-it-for-earning/) [Vikrmn: CA Vikram Verma](https://sms4smile.com/quotes/author/vikrmn-ca-vikram-verma/) > [In the quiet hours when we are alone and there is nobody to tell us what fine fellows we are, we come sometimes upon…](https://sms4smile.com/quotes/a-a-milne/in-the-quiet-hours-when-we-are-alone-and-there-is-nobody-to-tell-us/) [A. A. Milne](https://sms4smile.com/quotes/author/a-a-milne/) > [The company must be profitable. Preferably it will have increased its earnings for the past five years and there will have been no deficits…](https://sms4smile.com/quotes/peter-cundill/the-company-must-be-profitable-preferably-it-will-have-increased-its/) [Peter Cundill](https://sms4smile.com/quotes/author/peter-cundill/) Browse all 655 Earning quotes ```json { "@context": "https://schema.org", "@graph": [ { "@type": "Quotation", "text": "The only thing you should do with pro forma earnings is ignore them.", "creator": { "@type": "Person", "name": "Benjamin Graham" }, "isPartOf": { "@id": "https://sms4smile.com/quotes/#website" }, "url": "https://sms4smile.com/quotes/benjamin-graham/the-only-thing-you-should-do-with-pro-forma-earnings-is-ignore-them/", "about": { "@type": "Thing", "name": "Earning" }, "@id": "https://sms4smile.com/quotes/benjamin-graham/the-only-thing-you-should-do-with-pro-forma-earnings-is-ignore-them/#quotation", "image": { "@type": "ImageObject", "@id": "https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg", "contentUrl": "https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg", "url": "https://sms4smile.com/quotes/i/c34/benjamin-graham-1531_earning_the-only-thing-you-should-do-with-pro-fo_672446.jpg", "width": 1080, "height": 1080, "caption": "“The only thing you should do with pro forma earnings is ignore them.” — Benjamin Graham", "creditText": "SMS4Smile Quotes", "creator": { "@id": "https://sms4smile.com/quotes/#organization" } } }, { "@type": "BreadcrumbList", "itemListElement": [ { "@type": "ListItem", "position": 1, "name": "Home", "item": "https://sms4smile.com/" }, { "@type": "ListItem", "position": 2, "name": "Quotes", "item": "https://sms4smile.com/quotes/" }, { "@type": "ListItem", "position": 3, "name": "Benjamin Graham", "item": "https://sms4smile.com/quotes/author/benjamin-graham/" }, { "@type": "ListItem", "position": 4, "name": "The only thing you should do...", "item": "https://sms4smile.com/quotes/benjamin-graham/the-only-thing-you-should-do-with-pro-forma-earnings-is-ignore-them/" } ], "@id": "https://sms4smile.com/quotes/benjamin-graham/the-only-thing-you-should-do-with-pro-forma-earnings-is-ignore-them/#breadcrumb" }, { "@type": "WebSite", "@id": "https://sms4smile.com/quotes/#website", "name": "SMS4Smile Quotes", "url": "https://sms4smile.com/quotes/", "publisher": { "@id": "https://sms4smile.com/quotes/#organization" } }, { "@type": "Organization", "@id": "https://sms4smile.com/quotes/#organization", "name": "SMS4Smile Quotes", "url": "https://sms4smile.com/quotes/", "logo": { "@type": "ImageObject", "url": "https://sms4smile.com/quotes/wp-content/themes/sq/assets/icons/icon-512.png", "width": 512, "height": 512 } } ] } ```