Price to Earnings Growth

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Benzinga  Apr 4  Comment 
Below are the top general entertainment stocks on the NYSE in terms of PEG ratio. Orbitz Worldwide (NYSE: OWW) has a PEG ratio of 0.89. Orbitz Worldwide's trailing-twelve-month revenue is $847.00 million. Cedar Fair LP (NYSE: FUN) has a PEG...
Benzinga  Apr 3  Comment 
Below are the top broadcasting-radio stocks on the NYSE and the NASDAQ in terms of PEG ratio. Beasley Broadcast Group (NASDAQ: BBGI) has a PEG ratio of 0.62. Beasley Broadcast's trailing-twelve-month revenue is $104.90 million. Sirius XM...
Benzinga  Apr 2  Comment 
Below are the top biotechnology stocks on the NASDAQ in terms of PEG ratio. PDL BioPharma (NASDAQ: PDLI) has a PEG ratio of 0.35. PDL BioPharma's trailing-twelve-month revenue is $442.90 million. Enzymotec (NASDAQ: ENZY) has a PEG ratio of...
Benzinga  Apr 1  Comment 
Below are the top mid-cap waste management stocks on the NYSE and the NASDAQ in terms of PEG ratio. Stericycle (NASDAQ: SRCL) has a PEG ratio of 1.96. Stericycle's trailing-twelve-month revenue is $2.14 billion. Waste Connections (NYSE: WCN)...
Benzinga  Mar 31  Comment 
Below are the top mid-cap apparel stores stocks on the NYSE and the NASDAQ in terms of PEG ratio. Ascena Retail Group (NASDAQ: ASNA) has a PEG ratio of 1.08. Ascena Retail's trailing-twelve-month revenue is $4.80 billion. Abercrombie & Fitch...
Benzinga  Mar 28  Comment 
Below are the top textile-apparel footwear & accessories stocks on the NYSE in terms of PEG ratio. Wolverine World Wide (NYSE: WWW) has a PEG ratio of 1.26. Wolverine World Wide's trailing-twelve-month revenue is $2.69 billion. Skechers USA...
Benzinga  Mar 27  Comment 
Below are the top research services stocks on the NYSE and the NASDAQ in terms of PEG ratio. Myriad Genetics (NASDAQ: MYGN) has a PEG ratio of 1.11. Myriad Genetics' trailing-twelve-month revenue is $737.11 million. Qiagen NV (NASDAQ: QGEN)...
Benzinga  Mar 26  Comment 
Below are the top advertising agencies stocks on the NYSE and the NASDAQ in terms of PEG ratio. WPP plc (NASDAQ: WPPGY) has a PEG ratio of 1.59. WPP's trailing-twelve-month revenue is $17.68 billion. The Interpublic Group of Companies (NYSE:...
SeekingAlpha  Mar 25  Comment 
By David Alton Clark: I have been a General Electric (GE) bull for quite some time. Yet, based on recent shifts in the stock's fundamentals and performance I have reconsidered my opinion. The current budding geopolitical hazards increase the risk...
TechCrunch  Mar 25  Comment 
Since being launched just a few years ago, New Zealand-based cloud point-of-sale startup Vend has grown incredibly fast. To keep pushing forward, Vend has raised an additional $20 million in Series B funding from Peter Thiel international...




 

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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