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Valuation
Also called: PEG, Price/earnings to growth
The PEG ratio is the P/E ratio divided by the company's earnings growth rate. It asks whether a high P/E is backed by fast profit growth.
PEG = P/E ÷ Annual EPS growth (in percent)
A stock with a P/E of 30 whose earnings are growing 20% a year has a PEG of 30 ÷ 20 = 1.5. The same P/E with 30% growth gives a PEG of 1.
The PEG ratio is the P/E ratio divided by the company's earnings growth rate. It asks whether a high P/E is backed by fast profit growth.
PEG = P/E ÷ Annual EPS growth (in percent). A stock with a P/E of 30 whose earnings are growing 20% a year has a PEG of 30 ÷ 20 = 1.5. The same P/E with 30% growth gives a PEG of 1.
No. PEG ratio describes one aspect of a company, a price or a contract, and it is best read alongside other numbers and the business itself. Jivani Markets is a research and education platform; it does not give buy, sell or hold recommendations.