Lynch's PEG
EliteGrowth at a reasonable price — the PEG ratioThe PEG ratio (Peter Lynch, One Up on Wall Street) divides a stock's P/E by its earnings-growth rate, so a fast grower can carry a high P/E and still look cheap. We use Yahoo's published PEG when present and positive, otherwise compute it as trailing P/E ÷ growth-percent. Names with no earnings (no P/E) or negative growth have no meaningful PEG and are left off the list. A low PEG is a starting point for research, not a verdict; cross-check the growth assumption. Not investment advice.
How it works
Peter Lynch's complaint about price-to-earnings was that it tells you nothing on its own. Forty times earnings is cheap for a company growing fifty percent a year and ruinous for one growing five. So divide the multiple by the growth.
Below 1 is the rule of thumb: you are paying less in multiple than you are getting in growth. Around 1 is fair. Well above 1 means the growth has to arrive exactly on schedule for the price to make sense.
When it misleads
The growth number is the weak link. It looks backwards, and a company coming off a depressed year prints a spectacular rate that will not repeat. A startlingly low PEG is more often a fluky base year than a bargain.
It breaks entirely on companies with no earnings, and it flatters cyclicals at the top of their cycle — which is precisely when they are most expensive.
| # | Ticker | PEG | P/E | Growth % | Verdict |
|---|---|---|---|---|---|
| 101 | ALB | 0.77 | 386.90 | 1996.2% | Undervalued |
| 102 | CCL | 0.77 | 9.88 | -6.5% | Undervalued |
| 103 | ORCL | 0.78 | 21.74 | 54.5% | Undervalued |
| 104 | PSKY | 0.78 | 345.83 | -54.1% | Undervalued |
| 105 | AEHR | 0.78 | n/a | n/a | Undervalued |
| 106 | RDDT | 0.79 | 36.44 | 177.8% | Undervalued |
| 107 | ALAB | 0.79 | 146.95 | 186.2% | Undervalued |
| 108 | CNC | 0.79 | n/a | n/a | Undervalued |
| 109 | BIDU | 0.79 | n/a | -71.7% | Undervalued |
| 110 | TSM | 0.79 | 32.24 | 77.4% | Undervalued |
| 111 | AAOI | 0.80 | n/a | n/a | Undervalued |
| 112 | HWM | 0.80 | 49.03 | 33.0% | Undervalued |
| 113 | QCOM | 0.80 | 20.67 | -23.0% | Undervalued |
| 114 | WDC | 0.81 | 15.82 | 984.1% | Undervalued |
| 115 | AES | 0.81 | 5.54 | n/a | Undervalued |
| 116 | RJF | 0.81 | 14.37 | 42.0% | Undervalued |
| 117 | VRT | 0.82 | 54.88 | 53.0% | Undervalued |
| 118 | JBL | 0.83 | 37.43 | 27.6% | Undervalued |
| 119 | CRM | 0.83 | 22.59 | 118.9% | Undervalued |
| 120 | EXE | 0.84 | 7.63 | -45.5% | Undervalued |
| 121 | ADSK | 0.84 | 28.34 | 59.6% | Undervalued |
| 122 | HII | 0.85 | 16.47 | 36.5% | Undervalued |
| 123 | AMAT | 0.85 | 36.58 | 42.8% | Undervalued |
| 124 | HSY | 0.86 | 23.21 | 631.0% | Undervalued |
| 125 | BLK | 0.86 | 24.69 | 19.6% | Undervalued |
| 126 | TEL | 0.86 | 19.69 | 19.2% | Undervalued |
| 127 | LVS | 0.87 | 15.86 | -19.8% | Undervalued |
| 128 | VZ | 0.87 | 12.79 | -22.0% | Undervalued |
| 129 | NOK | 0.87 | 71.59 | -97.9% | Undervalued |
| 130 | MPWR | 0.87 | 70.92 | 85.8% | Undervalued |
| 131 | APH | 0.87 | 38.70 | 59.3% | Undervalued |
| 132 | BAC | 0.87 | 13.26 | 34.1% | Undervalued |
| 133 | PCAR | 0.88 | 24.73 | 4.2% | Undervalued |
| 134 | CTSH | 0.88 | 12.98 | 3.8% | Undervalued |
| 135 | MELI | 0.88 | 49.45 | -10.9% | Undervalued |
| 136 | GLW | 0.88 | 67.85 | 18.5% | Undervalued |
| 137 | META | 0.88 | 25.11 | -13.4% | Undervalued |
| 138 | SMCI | 0.88 | 10.96 | 434.7% | Undervalued |
| 139 | SCHW | 0.89 | 19.19 | 42.6% | Undervalued |
| 140 | IVZ | 0.89 | n/a | 88.0% | Undervalued |
| 141 | PNR | 0.89 | 14.47 | -11.1% | Undervalued |
| 142 | MDLZ | 0.90 | 22.38 | 144.9% | Undervalued |
| 143 | ARES | 0.91 | 55.83 | 6.5% | Undervalued |
| 144 | LII | 0.92 | 16.02 | 0.1% | Undervalued |
| 145 | PYPL | 0.93 | 9.91 | -3.1% | Undervalued |
| 146 | CVX | 0.93 | 20.32 | 321.9% | Undervalued |
| 147 | SYF | 0.93 | 7.67 | 3.6% | Undervalued |
| 148 | DECK | 0.94 | 10.94 | 1.1% | Undervalued |
| 149 | TXT | 0.94 | 15.18 | 5.2% | Undervalued |
| 150 | TXN | 0.94 | 40.22 | 51.8% | Undervalued |