Valuation
Forward PEG
The forward P/E ratio divided by the growth in earnings analysts expect. It asks whether a stock is cheap FOR its growth: a company on 30 times earnings that is growing 30% a year has a PEG of 1, the same as one on 10 times earnings growing 10%. Below 1 is the classic sign that you are paying little for the growth on offer; well above 2 means the price already assumes a lot. The catch is that it leans on forecasts, and fast-growth forecasts are often the least reliable numbers on the page, so treat a very low PEG on a very high growth estimate with some suspicion. In the Meridian Score it is one of the Valuation measures, compared against the company’s own sector.
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Educational information, not investment advice. See it applied across the screener →