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Low PE Growth Stocks

This page lists companies that have unusually low price-to-earnings growth ratios (PEG ratios). The PEG ratio is a valuation metric for determining the relative trade-off between a stock's price, its earnings per share (EPS) and its expected earnings growth. It is calculated by dividing a stock's P/E ratio by the earnings growth rate. PEG ratios are particularly useful in comparing the valuation of two stocks that have significantly different earnings growth rates. How to interpret PEG (price-to-earnings growth) ratios.

Exchange(s):
Market Cap:
CompanyPE RatioPEG RatioMarket CapCurrent PricePrice ChangeVolumeAverage VolumeIndicator(s)
Lexington Realty Trust logo
LXP
Lexington Realty Trust
11.36-21.72$2.71 billion$10.91-0.4%1.28 million1.79 millionAnalyst Upgrade
HITACHI CHEM CO/ADR logo
HCHMY
HITACHI CHEM CO/ADR
33.47-16.04$8.75 billion$84.00flat1177
CAPCOM CO LTD/ADR logo
CCOEY
CAPCOM CO LTD/ADR
24.64-10.44$5.87 billion$13.31-3.2%104917
TWODY
TAYLOR WIMPEY P/ADR
9.56-7.39$8.86 billion$27.05+0.2%10013High Trading Volume
Heavy News Reporting
RPT Realty logo
RPT
RPT Realty
10.86-6.57$1.16 billion$14.66+0.5%434,900504,892Heavy News Reporting
Sabra Health Care REIT logo
SBRA
Sabra Health Care REIT
9.62-5.55$4.52 billion$22.03-1.3%1.64 million1.48 millionAnalyst Upgrade
Analyst Revision
HENNES & MAURIT/ADR logo
HNNMY
HENNES & MAURIT/ADR
21.33-4.01$31.78 billion$3.84+0.7%17,31023,442
PERSIMMON/ADR logo
PSMMY
PERSIMMON/ADR
10.07-2.62$11.50 billion$76.22+0.9%1,3464,975Analyst Upgrade
United Therapeutics logo
UTHR
United Therapeutics
6.96-1.50$4.15 billion$93.13-1.1%482,200432,567Analyst Upgrade
Heavy News Reporting
Mallinckrodt logo
MNK
Mallinckrodt
0.650.04$377.56 million$5.20-0.8%11.57 million8.70 million
Changyou.Com logo
CYOU
Changyou.Com
6.660.12$554.87 million$10.46flat111,095248,941Analyst Upgrade
Increase in Short Interest
Carrizo Oil & Gas logo
CRZO
Carrizo Oil & Gas
2.820.12$725.14 million$7.83flat30.96 million5.83 millionHigh Trading Volume
Heavy News Reporting
GreenTree Hospitality Group logo
GHG
GreenTree Hospitality Group
22.300.13$1.37 billion$13.60+0.7%127,700152,367
Victory Capital logo
VCTR
Victory Capital
14.620.15$1.48 billion$21.35-2.2%76,100102,567
NRG Energy logo
NRG
NRG Energy
15.990.16$9.72 billion$38.54-0.2%2.06 million2.52 millionUnusual Options Activity
Corporacion America Airports logo
CAAP
Corporacion America Airports
148.500.18$969.73 million$5.94-0.8%91,600264,283
Callon Petroleum logo
CPE
Callon Petroleum
4.710.19$974.08 million$3.86-5.9%30.09 million17.57 millionAnalyst Revision
Heavy News Reporting
Navient logo
NAVI
Navient
6.630.19$3.00 billion$13.86+1.8%1.64 million1.56 millionUpcoming Earnings
Analyst Revision
Conn's logo
CONN
Conn's
4.130.20$297.73 million$10.38-1.3%1.22 million1.30 million
Air France-KLM logo
AFLYY
Air France-KLM
10.250.21$4.60 billion$10.87+1.0%1,38215,780Heavy News Reporting
GNC logo
GNC
GNC
6.820.24$199.57 million$2.32-3.7%957,2171.07 million
JinkoSolar logo
JKS
JinkoSolar
15.020.24$995.57 million$22.83+0.9%727,9951.02 millionHeavy News Reporting
Canadian Solar logo
CSIQ
Canadian Solar
6.830.24$1.35 billion$22.41-2.7%1.32 million782,423Analyst Downgrade
Daqo New Energy logo
DQ
Daqo New Energy
12.080.25$581.41 million$53.630.0%220,900209,683Heavy News Reporting
Tupperware Brands logo
TUP
Tupperware Brands
2.190.25$456.67 million$9.42+1.0%1.62 million1.56 million
Party City Holdco logo
PRTY
Party City Holdco
1.940.27$284.33 million$3.08+2.0%4.10 million4.71 millionIncrease in Short Interest
Parsley Energy logo
PE
Parsley Energy
12.690.27$5.66 billion$17.89+0.2%5.02 million7.63 millionAnalyst Report
Increase in Short Interest
Analyst Revision
Heavy News Reporting
Sappi logo
SPPJY
Sappi
6.480.27$1.55 billion$2.85-3.7%10,9544,470High Trading Volume
AngloGold Ashanti logo
AU
AngloGold Ashanti
38.470.33$8.52 billion$20.39-1.2%3.28 million3.09 million
United Continental logo
UAL
United Continental
9.820.33$22.66 billion$89.70+0.2%4.22 million2.86 millionUpcoming Earnings
Analyst Upgrade
LexinFintech logo
LX
LexinFintech
8.970.34$2.45 billion$14.35+0.6%1.39 million2.00 million
Allegiant Travel logo
ALGT
Allegiant Travel
17.780.36$2.84 billion$177.79+0.1%1.13 million151,305High Trading Volume
Heavy News Reporting
JetBlue Airways logo
JBLU
JetBlue Airways
12.390.37$5.49 billion$19.21+1.1%5.54 million4.91 millionUpcoming Earnings
Analyst Upgrade
Decrease in Short Interest
Heavy News Reporting
Brighthouse Financial logo
BHF
Brighthouse Financial
5.510.37$4.39 billion$40.99+0.8%608,300980,033Analyst Upgrade
Decrease in Short Interest
Penn National Gaming logo
PENN
Penn National Gaming
27.960.38$3.13 billion$26.00-1.0%1.45 million1.23 millionAnalyst Downgrade
Chemours logo
CC
Chemours
3.080.38$2.95 billion$17.46-3.3%2.80 million2.62 millionDecrease in Short Interest
Century Casinos logo
CNTY
Century Casinos
74.550.39$245.01 million$8.20-1.2%46,96962,689Decrease in Short Interest
Foundation Building Materials logo
FBM
Foundation Building Materials
55.170.39$843.89 million$19.31-1.6%157,508401,825
Mesa Air Group logo
MESA
Mesa Air Group
5.650.39$300.00 million$9.27-1.0%214,354224,938
Pra Group logo
PRAA
Pra Group
25.600.40$1.70 billion$36.87-0.5%214,538191,837Decrease in Short Interest
Mercury General logo
MCY
Mercury General
26.610.40$2.66 billion$47.90-1.2%216,192341,035Heavy News Reporting
Tecnoglass logo
TGLS
Tecnoglass
9.260.42$360.51 million$7.87-0.8%74,49836,050Analyst Downgrade
High Trading Volume
Decrease in Short Interest
Berry Petroleum logo
BRY
Berry Petroleum
6.400.42$674.71 million$8.07-3.1%824,971655,081Analyst Revision
Heavy News Reporting
Alliance Data Systems logo
ADS
Alliance Data Systems
5.240.42$5.21 billion$112.91-1.0%576,400648,683Analyst Downgrade
Alaska Air Group logo
ALK
Alaska Air Group
14.940.44$8.15 billion$66.62+0.1%943,0121.09 million
Koppers logo
KOP
Koppers
9.930.45$710.16 million$34.74-0.7%93,431140,236Analyst Downgrade
Qurate Retail Inc Series A logo
QRTEA
Qurate Retail Inc Series A
4.750.46$3.66 billion$8.84-1.9%3.72 million5.23 millionAnalyst Downgrade
Oasis Midstream Partners logo
OMP
Oasis Midstream Partners
9.630.46$552.55 million$17.52+0.9%50,200111,733
Encore Capital Group logo
ECPG
Encore Capital Group
7.410.47$1.15 billion$36.92-0.1%183,000254,333Analyst Upgrade
NMC HEALTH PLC/ADR logo
NMHLY
NMC HEALTH PLC/ADR
15.690.47$3.68 billion$20.87+10.8%6,3858,767Heavy News Reporting
SUBARU CORP/ADR logo
FUJHY
SUBARU CORP/ADR
14.200.47$19.17 billion$12.50+3.1%28,44549,627
Athene logo
ATH
Athene
8.060.47$8.71 billion$46.90-0.2%850,774966,646Insider Selling
Discovery Communications logo
DISCA
Discovery Communications
15.370.47$16.76 billion$32.43-1.0%3.29 million3.72 millionDecrease in Short Interest
Herc logo
HRI
Herc
27.520.48$1.33 billion$45.96+0.1%284,702183,525
SLM logo
SLM
SLM
8.280.48$3.72 billion$8.86+0.4%2.08 million3.09 millionUpcoming Earnings
Analyst Upgrade
Decrease in Short Interest
Credit Suisse Group logo
CS
Credit Suisse Group
16.510.48$34.96 billion$13.87-0.5%1.77 million1.97 million
Office Depot logo
ODP
Office Depot
7.400.50$1.35 billion$2.59+4.9%4.31 million5.27 million
IMPALA PLATINUM/S logo
IMPUY
IMPALA PLATINUM/S
36.830.51$7.60 billion$10.68+3.3%55,13896,667
Voya Financial logo
VOYA
Voya Financial
15.520.51$8.34 billion$62.71+1.0%914,5001.58 millionAnalyst Revision
Heavy News Reporting
Meet Group logo
MEET
Meet Group
24.040.51$405.16 million$5.77+2.1%1.79 million828,887Analyst Upgrade
High Trading Volume
Increase in Short Interest
Celgene logo
CELG
Celgene
14.220.51$77.04 billion$108.24flat114,3026.77 million
General Motors logo
GM
General Motors
5.440.52$50.22 billion$35.60+0.1%9.87 million9.47 millionIncrease in Short Interest
Focus Financial Partners logo
FOCS
Focus Financial Partners
28.550.52$1.99 billion$28.26+4.3%642,700253,808High Trading Volume
Heavy News Reporting
American Axle & Manufact. logo
AXL
American Axle & Manufact.
2.940.53$1.05 billion$9.63+0.5%892,1911.50 millionUnusual Options Activity
Heavy News Reporting
Michaels Companies logo
MIK
Michaels Companies
2.720.54$939.42 million$6.40-1.4%5.07 million5.82 millionAnalyst Downgrade
PUMP
Propetro
5.590.54$1.17 billion$11.17-2.4%706,0021.20 millionDecrease in Short Interest
Turkcell Iletisim Hizmetleri A.S. logo
TKC
Turkcell Iletisim Hizmetleri A.S.
12.690.54$5.42 billion$6.09-1.1%149,000254,125Decrease in Short Interest
DHI Group logo
DHX
DHI Group
20.200.56$167.08 million$3.03-1.3%84,000118,658Analyst Downgrade
Decrease in Short Interest
Banco Bradesco logo
BBD
Banco Bradesco
11.890.56$65.22 billion$8.44+2.4%12.17 million13.44 millionDividend Cut
Analyst Upgrade
NetEase logo
NTES
NetEase
50.920.56$44.80 billion$349.82-0.1%782,425708,886
Unum Group logo
UNM
Unum Group
5.650.56$5.95 billion$29.37+0.8%1.43 million1.65 millionDividend Announcement
Analyst Upgrade
Analyst Revision
Heavy News Reporting
XPO Logistics logo
XPO
XPO Logistics
29.670.57$7.53 billion$94.64-0.7%1.63 million1.43 millionAnalyst Report
Unusual Options Activity
Heavy News Reporting
VIAC
ViacomCBS
7.610.57$15.00 billion$39.49-1.4%6.56 million6.07 millionAnalyst Report
Ally Financial logo
ALLY
Ally Financial
9.120.57$11.69 billion$30.45-1.0%3.93 million3.51 millionUpcoming Earnings
Dividend Increase
Analyst Upgrade
Dell logo
DELL
Dell
3.700.58$37.19 billion$50.34-1.9%3.29 million2.83 millionAnalyst Downgrade
Insider Selling
Pilgrim's Pride logo
PPC
Pilgrim's Pride
23.050.58$7.37 billion$29.50-1.4%719,300736,800Analyst Downgrade
HD Supply logo
HDS
HD Supply
11.850.58$6.48 billion$40.30-1.0%1.86 million1.23 million
Affiliated Managers Group logo
AMG
Affiliated Managers Group
5.910.59$4.18 billion$85.64-0.9%294,300488,467
Bausch Health Companies logo
BHC
Bausch Health Companies
7.520.59$10.48 billion$30.25+1.7%5.13 million3.43 million
Delphi Technologies logo
DLPH
Delphi Technologies
2.560.60$970.89 million$11.23-1.1%672,257868,845Analyst Downgrade
Unusual Options Activity
Analyst Revision
Heavy News Reporting
Tempur Sealy International logo
TPX
Tempur Sealy International
29.680.60$4.75 billion$87.86+0.4%597,800516,675
TopBuild logo
BLD
TopBuild
26.630.60$3.58 billion$111.60+1.1%346,300274,892Heavy News Reporting
NV5 Global logo
NVEE
NV5 Global
17.170.60$713.12 million$55.63-1.8%158,333254,267Increase in Short Interest
Heavy News Reporting
Davita logo
DVA
Davita
22.260.61$10.00 billion$79.47+0.6%795,6981.03 millionAnalyst Upgrade
Analyst Revision
Delta Air Lines logo
DAL
Delta Air Lines
8.490.61$39.85 billion$62.03+0.2%5.66 million7.52 millionEarnings Announcement
Analyst Report
Winnebago Industries logo
WGO
Winnebago Industries
16.160.61$1.74 billion$55.58-1.3%425,200658,955Ex-Dividend
Analyst Downgrade
Mastercraft Boat logo
MCFT
Mastercraft Boat
5.680.61$294.31 million$15.61+2.9%137,000160,825
First Bancorp logo
FBP
First Bancorp
16.810.61$2.21 billion$10.42flat962,3001.17 millionAnalyst Upgrade
Unusual Options Activity
WPX Energy logo
WPX
WPX Energy
140.780.62$5.33 billion$12.67-0.9%6.50 million7.46 millionAnalyst Revision
United Rentals logo
URI
United Rentals
9.760.62$11.60 billion$158.72+0.7%1.12 million970,229Heavy News Reporting
Commscope logo
COMM
Commscope
7.000.63$2.86 billion$14.78+0.2%3.15 million2.77 million
Yandex logo
YNDX
Yandex
47.790.63$14.14 billion$45.40+2.9%3.33 million1.73 millionAnalyst Downgrade
Heavy News Reporting
Blucora logo
BCOR
Blucora
15.340.63$1.18 billion$23.31+1.6%745,390436,430Analyst Downgrade
Heavy News Reporting
OneMain logo
OMF
OneMain
8.540.63$5.88 billion$43.19+1.0%657,240571,196Increase in Short Interest
Heavy News Reporting
Dmc Global logo
BOOM
Dmc Global
21.270.64$643.11 million$44.02+0.3%181,320212,418
Lincoln National logo
LNC
Lincoln National
7.080.64$11.75 billion$60.04+1.4%1.37 million1.67 million
Comerica logo
CMA
Comerica
9.490.64$9.84 billion$68.72+0.7%2.11 million1.44 millionUpcoming Earnings
LI NING CO LTD/ADR logo
LNNGY
LI NING CO LTD/ADR
63.670.66$6.10 billion$70.04flat55200
Lenovo Group logo
LNVGY
Lenovo Group
15.310.66$9.06 billion$15.16+0.5%12,10246,817
United Insurance logo
UIHC
United Insurance
28.390.67$460.88 million$10.79-0.8%109,879129,990Increase in Short Interest
Heavy News Reporting
Last Updated: Saturday, 01:44 AM ET. Prices are 15-minutes delayed.

Summary - Fundamental analysis is an important part of any investment strategy. Investors have many tools that can help them determine if a company is appropriately valued such as a balance sheet. When investing in stocks, one of the key ratios that is used is the price-to-earnings (P/E) ratio. In simple terms, this tells an investor how much they are paying to purchase $1 or a company’s earnings.

However, while the P/E ratio can show a company as a good investment, it doesn’t take into account future earnings. This is why many investors have come to supplement the P/E ratio with another measurement tool the price-to-earnings growth (or PEG) ratio. This ratio takes into account a company’s future earnings growth to give a more accurate picture of a stock’s valuation.

PEG is particularly important for certain growth stocks that may historically have periods of higher and lower growth when compared to the overall stock market. These stocks may have a forecasted EPS growth rate that supports a P/E ratio that would make a stock seem overvalued. Likewise, a PEG ratio for a mature company may show that what many investors consider to be a fair P/E ratio is actually indicative of a stock that is overvalued.

However, like other ratios, the PEG ratio is most helpful when comparing a stock price to others in its industry or sector. Some sectors, such as technology, may have much higher future earnings growth. However, the accepted rule among investors is that a PEG of greater than 1 is considered to indicate a stock price that is too high based on expected earnings growth. A PEG of less than 1 is considered to indicate a stock that is undervalued based on projected earnings growth.

Introduction

Legendary investment manager Peter Lynch once wrote: "The P/E ratio of any company that's fairly priced will equal its growth rate". Certainly, a stock's price-to-earnings ratio (P/E ratio) is widely considered a reasonably accurate measure of a company's valuation, and can sometimes be used as a way of comparing one company against another.

The P/E ratio is a measurement of how much an investor is paying to buy $1 of a company’s earnings or profit. To calculate the P/E Ratio you simply divide the stock price by the earning per share:

P/E Ratio = Stock Price/Earnings per share (EPS)

For example, if a company is reporting earnings of $3 per share and their stock is selling for $30 per share, the P/E ratio is 10 ($30 per share/$3 per share).

While there is no “standard” P/E Ratio for all stocks and sectors, investors can generally find that different industries will have a P/E ratio that is considered normal. For example, it’s not uncommon to find technology companies with a P/E ratio of 20 or higher. This is due in part because these companies include many growth stocks that are anticipated to increase in share price and EPS. Financial services companies might have P/E ratios in the low teens. For investors this means rather than one-size-fits-all, the objective is to ensure that two companies in the same industry have a similar P/E ratio. However, if all companies in a particular sector begin to have P/E ratios that are abnormally high or low (based on their historical pattern) it may indicate that the stock is overvalued or undervalued. For example, in the months leading up to the real estate crash of 2007, the P/E ratio of real estate stocks soared. A similar phenomenon occurred before the tech stock crash in the early 2000s.

However, like many ratios, the P/E ratio has limitations. The primary limitation of P/E ratio is that it is limited to a moment in time. It gives you an accurate assessment of where one company compares to another at that moment. However, to get a more accurate view of whether a stock is overvalued or undervalued requires knowledge of the anticipated growth rate between the two companies. For example, a company with a P/E of 30 with an anticipated growth rate of 50% may be much more undervalued than a company with a more enticing P/E of 20, but with an anticipated growth rate of 5%, which is fairly typical of a mature company.

Because of the limitations of the P/E ratio, investors will frequently use a ratio that factors in a company’s projected or historical growth rate to get a more accurate picture of a stock’s valuation. This number is known as the PEG ratio and it is the focus of this article. In this article we’ll define the PEG ratio and provide examples, we’ll also review how to interpret the PEG ratio and review some of the limitations of this ratio.

What is the price-to-earnings growth (PEG) ratio?

This limitation spawned the need for a new metric, the ration of the P/E to growth (or PEG). The formula for PEG is as follows:

P/E Ratio/Earnings per share (EPS) growth Rate

If you were to put this formula into a sentence, it would say that the PEG ratio is a calculation that helps investors determine whether a stock's price is overvalued or undervalued by not only looking at their current earnings but also looking at their expected future earnings growth.

To test Lynch’s theory, PEG would imply that if a company had a “Fair P/E ratio” than it should have a PEG of around 1.

If:         Fair P/E Ratio = EPS Growth Rate

Than:    P/E Ratio/EPS Growth Rate = 1

How to interpret the PEG ratio

If the PEG ratio is greater than 1, the implication is that the stock is more expensive (in relative terms). A PEG ratio below 1 means that a stock is trading at below its fair value.

While it’s true that the P/E ratio is a multiple and the PEG is a percent, it’s important to focus on the true objective and that is to determine whether a stock is properly valued. To that end, the PEG is considered to be more accurate than simply looking at a company’s P/E ratio when determining proper valuation.

For example, by definition, a high P/E ratio typically signals to investors that a stock is overvalued. However, if the company has high growth estimates than calculating the PEG can show a very different picture and one that could suggest the stock is still a buy. In our earlier example, a company with a P/E ratio of 30 might be considered to be overbought, but if it is forecasting a growth rate of 50% than its PEG ratio suggests. Using the formula:

PEG = P/E Ratio/Growth Rate, the company would have a PEG ratio of 0.6

PEG = 30/50 = 0.6

In this case, the PEG number suggests that either analysts are setting their expectations too low or that the stock’s growth is being undervalued. In either case, the ratio suggests the stock has room to grow.

The opposite is also true. If a company has a P/E range of 8 which may be lower than expected or lower than others in its sector, the assumption could be that the stock is undervalued. However, a closer look may indicate that the company is expecting only about 5% for the growth for the year. While that growth rate is certainly not poor when you perform the PEG calculation you come up with:

PEG = 8/5 = 1.6

In this case, the company may very well have a difficult time increasing their share price above its current level.

Limitations of the P/E Growth ratio

One of the basic limitations of PEG is that it does not forecast growth beyond the period being measured. If a company has a stellar PEG number, it says nothing about the company’s future growth prospects. It also does not provide a context for the growth number. For example, that growth could be due to a one-time event. Also, when compared with other analysis tools such as a discounted cash flow analysis, the PEG ration tends to undervalue the companies with the highest growth rates. Another limitation of the PEG ratio is how future growth is calculated. If the company uses projected growth, it may significantly different (and easier to manipulate) than if they were to use historical data.

However, these limitations make the PEG ratio no different than other ratios or metrics. Every investor needs to use more than one measurement tool to get a complete picture of a stock’s valuation. For example, looking at a company’s balance sheet over the course of several quarters can give investors a better look at trends having to do with their revenue growth or free cash flow.

The final word on the P/E growth ratio

The P/E growth ratio (or PEG) was developed and is used as a refinement of the standard P/E ratio that is used in fundamental analysis. The PEG ratio factors in a company’s forecasted growth potential either using historical data (meaning it's backward-looking) or using projected growth numbers (forward-looking). The formula for the PEG ratio is as follows:

PEG Ratio = P/E Ratio/Growth rate

Just like a P/E ratio, there is no "standard" for what constitutes a good PEG ratio. Some industries will have a "typical" PEG ratio that would seem high or low for another sector. In general, however, a P/E ratio that is around 1 is said to indicate a fair valuation for a stock. So for example, a stock that has a P/E ratio of 20 with a forecasted growth rate 20 percent would have a PEG ratio of 1.

A PEG ratio above 1 will typically indicate an overvalued stock and a PEG ratio of less than 1 will typically be an indication that a stock is undervalued.

Like any fundamental analysis ratio, the PEG has limitations, the largest being that it is only predictive of the time period being measured. For example, a company may be projecting 20% growth for the following year, but even if it achieves that growth there is no indication that it will continue to grow at that pace, nor does the PEG ratio provide a context for the growth figure. Also, the growth projections used for the PEG ratio can be determined using past growth data. While accurate in the sense that it is based on an actual, not projected, a number it can be higher or lower than the rate of growth the company is currently experiencing. Despite these limitations, the PEG ratio is still considered to be a good baseline test of valuation.


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