Price to Earnings Growth

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Benzinga  Jun 24  Comment 
Below are the top farm & construction machinery stocks on the NYSE in terms of PEG ratio. CNH Industrial NV (NYSE: CNHI) has a PEG ratio of 0.79. CNH Industrial's trailing-twelve-month EPS is $0.59. Caterpillar Inc. (NYSE: CAT) has a PEG...
Benzinga  Jun 23  Comment 
Below are the top asset management stocks on the NASDAQ in terms of PEG ratio. OFS Capital Corp (NASDAQ: OFS) has a PEG ratio of 0.64. OFS Capital's trailing-twelve-month EPS is $1.15. Encore Capital Group, Inc. (NASDAQ: ECPG) has a PEG...
Benzinga  Jun 22  Comment 
Below are the top mid-cap aerospace/defense products & services stocks on the NYSE and the NASDAQ in terms of PEG ratio. Huntington Ingalls Industries Inc (NYSE: HII) has a PEG ratio of 1.11. Huntington Ingalls' trailing-twelve-month EPS is...
Benzinga  Jun 12  Comment 
Below are the top small-cap agricultural chemicals stocks on the NYSE and the NASDAQ in terms of PEG ratio. China Green Agriculture, Inc (NYSE: CGA) has a PEG ratio of 0.20. Travelzoo's trailing-twelve-month revenue is $257.00 million. ...
Benzinga  Jun 11  Comment 
Below are the top small-cap internet information providers stocks on the NYSE and the NASDAQ in terms of PEG ratio. Travelzoo Inc. (NASDAQ: TZOO) has a PEG ratio of 0.64. Travelzoo's trailing-twelve-month revenue is $138.40 million. Tucows...
Euromoney  Jun 10  Comment 
A series of market disasters in recent years, culminating in the SNB’s decision to abandon its peg to the euro, have forced banks to reconsider their commitment to the prime brokerage (PB) business, leaving many smaller hedge funds and other...
Benzinga  Jun 10  Comment 
Below are the top small-cap air delivery & freight services stocks on the NYSE and the NASDAQ in terms of PEG ratio. Roadrunner Transportation Systems Inc (NYSE: RRTS) has a PEG ratio of 0.98. Roadrunner Transportation's trailing-twelve-month...
guardian.co.uk  Jun 9  Comment 
Chancellor will use Mansion House speech to outline new fiscal framework with aim of permanent budget surpluses and only ‘exceptional’ borrowing George Osborne is to announce a return to the public finances of the Victorian age, with plans...
The Straits Times  Jun 9  Comment 
June 10, 2015 1:42 AM MALAYSIA'S central bank is unlikely to reinstate the exchange-rate peg it imposed during the Asian financial crisis, even though the ringgit is sliding fast to levels seen against the greenback then, economists said yesterday.
Benzinga  Jun 9  Comment 
Below are the top mid-cap apparel stores stocks on the NYSE and the NASDAQ in terms of PEG ratio. Urban Outfitters, Inc. (NASDAQ: URBN) has a PEG ratio of 1.23. Urban Outfitters' trailing-twelve-month revenue is $3.38 billion. Ascena Retail...




 

This article is about the financial metric Price/Earnings To Growth. For the article on the company with ticker PEG, see Public Service Enterprise Group (PEG).

The PEG ratio equals the P/E Ratio divided by projected annual earnings-per-share growth

The PEG ratio (alternately PE/G, P/E to G, Price/Earnings to Growth, or Price to Earnings to Growth) is a valuation metric comparing the Price to Earnings ratio of a company to its projected annual Earnings Per Share growth.

A PEG ratio below 1 would indicate a company is undervalued relative to its share price, while a PEG greater than 1 would indicate an overpriced stock, as a high P/E should generally correlate with a market expectation of greater forthcoming earnings.

However, as PEG relies on projected EPS growth, its usefulness is tied directly to the accuracy of such projections.

It must be noted that PEG is only a rule of thumb and has no underlying mathematical basis for gauging what a company's share price truly "should" be. The ratio has been criticized for penalizing value stocks, which have lower earnings growth.

Examples

  • Company XYZ is trading at $20/share with an EPS of $1.00 for a P/E of 20. Analysts predict a 50% annual earnings increase over the next five years. The PEG ratio of XYZ is therefore .40, indicating the stock is undervalued by the market assuming the earnings projection is accurate.
  • Company ABC is trading at $50/share with an EPS of $1.00 for a P/E of 50. Analysts predict a 50% annual earnings increase over the next five years. The PEG ratio of ABC is therefore 1.00, indicating the stock is valued properly by the market assuming the earnings projection is accurate.
  • Company LMN is trading at $10/share with an EPS of $1.00 for a P/E of 10. Analysts predict a 5% annual earnings increase over the next five years. The PEG ratio of LMN is therefore 2.00, indicating the stock is overvalued by the market assuming the earnings projection is accurate.
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