Feb 24, 2025 · What Is the Price/Earnings-to-Growth (PEG) Ratio? The price/earnings to growth ratio (PEG ratio) is a stock's price-to-earnings (P/E) ratio divided by the growth rate of its earnings for a...

The formula for the PEG ratio is derived by dividing the stock’s price-to-earnings (P/E) ratio by the growth rate of its earnings for a specified time period. PEG ratio stands for Price/Earnings to Growth ratio, which lets analysts assess how likely a firm is to grow in the coming times.

Jan 17, 2025 · Step 2: Apply the PEG Ratio Formula. The PEG ratio formula is: PEG = P/E Ratio / Earnings Growth Rate (%) PEG = 20 / 25 = 0.8. Interpretation: A PEG ratio of 0.8 indicates that the...

Sep 16, 2024 · The formula to calculate the PEG ratio starts with determining the P/E ratio, which is the share price divided by earnings per share (EPS), and then the P/E ratio is divided by the expected EPS growth rate.

Feb 12, 2024 · The price/earnings-to-growth ratio, or PEG ratio, divides a company's price-to-earnings (P/E) ratio by its earnings growth rate over a specific period. It...

Sep 29, 2024 · Find out how to determine a stock's relative value by calculating its price-to-earnings-to-growth ratio (PEG ratio).

Jan 3, 2024 · Put simply, you take the price/earnings ratio and divide it by the earnings growth. Here is the formula: PEG ratio = (price / earnings) / growth. How to use the PEG ratio formula to value a stock. To explain how this works, let's examine Microsoft's PEG ratio.

The ' PEG ratio' (price/earnings to growth ratio) is a valuation metric for determining the relative trade-off between the price of a stock, the earnings generated per share (EPS), and the company's expected growth. In general, the P/E ratio is higher for a …

What is the PEG Ratio Formula? The PEG ratio formula for a company is as follows: PEG = Share Price / Earnings per share / Earnings per Share growth rate. Using the example shown in the table at the top of this guide, there are three companies we can compare – Fast Co, Moderate Co, and Slow Co.

The PEG ratio, often called price earnings to growth, is an investment calculation that measures the value of a stock based on the current earnings and the potential future growth of the company.