Screen of the Week 10/05/2010: PEG Ratio
Free Online Articles Directory
Why Submit Articles?
Top Authors
Top Articles
FAQ
ABAnswers
0 && $.browser.msie ) {
var ie_version = parseInt($.browser.version);
if(ie_version Login
Register
Hello
My Home
Sign Out
Email
Password
Remember me?
Lost Password?
Home Page > Finance > Investing > Screen of the Week 10/05/2010: PEG Ratio
Screen of the Week 10/05/2010: PEG Ratio
Posted: Oct 06, 2010 |Comments: 0
|
]]>
This week, I’m going to focus on a simple strategy that uses the PEG Ratio for determining a company’s under or overvaluation. Let’s first start with a definition.
A PEG ratio is simply the: P/E Ratio divided by the Growth Rate
A value of 1 or less is considered good (at par or undervalued), while a value of greater than 1, in general, is not as good (overvalued). Once again, the PEG Ratio is simply the P/E Ratio divided by the Growth Rate. Many believe this ratio tells a more complete story than just the P/E.
A company with a P/E Ratio of 25 and a Growth Rate of 20 would have a PEG Ratio of 1.25 (25 / 20 = 1.25). While a company with a P/E Ratio of 40 and a Growth Rate of 50 would have a PEG Ratio of 0.8.
Traditionally, investors would look at the stock with the lower P/E Ratio and deem it a bargain (undervalued). But looking at it closer, you can see it doesn’t have the growth rate to justify its P/E. The stock with the P/E of 40, though, is actually the better bargain since its PEG Ratio is lower (0.8), implying it’s undervalued with more potential value. (Undervalued in relation to its projected growth rate). In other words, the lower the PEG, the better the value, because the investor would be paying less for each unit of earnings growth. So for this week’s screen, we’re going to use the PEG ratio to find value.
Let’s first start with:
* Average Broker Rating less than or equal to 1.5
(The brokers too have to be on board.)
* Average Broker Rating Change over last 4 weeks greater than 0
(Only stocks that have been recently upgraded will get thru.)
* Projected One Year Growth Rate greater than or equal to 20
(Strong performers are what we’re looking for.)
* PEG Ratio less than 1
(P/E using F(1) divided by its F(1) projected growth rate.)
(We’re using a classic, textbook example to identify undervalued stocks.)
* Price greater than or equal to $5
* Avg. 20 Day Volume greater than or equal to 100,000
Here are 5 stocks from this week’s list (for Tues. 10/5/10):
AMG – Affiliated Managers Group, Inc.
KRA- Kraton Performance Polymers, Inc.
MIC – Macquarie Infrastructure Company LLC
SSW – Seaspan Corp.
VPHM – ViroPharma Inc.
Sign up now for your 2 week free trial to the Research Wizard and get the rest of the stocks on this list and start using this screen in your own trading. Or create your own strategies and test them before you invest. Know what to buy and when to sell.
Start screening for these companies today with a free trial to the Research Wizard.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Retrieved from “http://www.articlesbase.com/investing-articles/screen-of-the-week-10052010-peg-ratio-3415018.html”
(ArticlesBase SC #3415018)
Start increasing your traffic today just by submitting articles with us, click here to get started.
Liked this article? Click here to publish it on your website or blog, it’s free and easy!
Kevin Matras -
About the Author:
Kevin Matras is the Research Wizard Product Manager and weekly contributing Editor at Zacks Investment Research who creates and writes the Zacks Commentary Screen of the Week and Know Your Options. For more information, visit http://www.zacks.com.
]]>
Questions and Answers
Ask our experts your Investing related questions here…
200 Characters left
How I cun unlocked the touch screen of my ebad 10.2 android 2.1? I don’t know what key I touch and then it has been lockedAsked
What are weekly ratios of adjusted closing prices ?
I do not have a puppy. I have 2 shih tzus which are 8 and 10 years old. The 10 year old just started acting crazy about 3 weeks ago. she is already now on anxiety meds, but so far not helping
Rate this Article
vote(s)
0 vote(s)
Feedback
RSS
Print
Email
Re-Publish
Source: http://www.articlesbase.com/investing-articles/screen-of-the-week-10052010-peg-ratio-3415018.html
Article Tags:
amg, affiliated managers, kra, kraton, performance, polymers, mic, macquarie, ssw, seaspan, vphm, viropharma, stock, screening, zacks
Latest Investing Articles
More from Kevin Matras
Higher Returns from Safe Investments by Dr. Marvin Appel (download)
Dr. Marvin Appel shows how to take advantage of high-yield bond funds and income-producing equity strategies…when to purchase individual bonds, when to use bond mutual funds, and which bond funds are best…how to finally make diversification work again.
By:
Conan Edol
Finance>
Investingl
Feb 12, 2011
Forex Options Trading – The Basic Things to Know About Forex Trading (Forex Growth Bot)
The previous makes use of technical indicators and visible charts to look the developments and movements of prices to permit them to are expecting it. The latter makes use of stories reviews at the economic system in addition to different indicators, i.e., employment information, GDP, political standing and adjustments, etc. These two are used to help traders on their choices on what trades to take.
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
How to Make Money Online With Forex Trading Pro System
Another way stay the product, load up your actual money and get started making actual profits. It honestly couldn’t be more uncomplicated, and completely possibility free. How’s that for getting cash online?
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Why You Rock in Forex Demo Trading But Suck in Live Trading (Forex Trading Pro System)
However that doesn’t imply you have to tackle a large quantity of risk to end up the rest to anybody. You are simply transferring up to the following stage of trading. Take your time, because the more practice you get buying and selling live, the better probability you’ve got at being a profitable trader.
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Forex Growth Bot – Why Currency Day Traders Lose and a Better Way to Trade
So disregard approximately currency day trading systems and if you need to business brief term, get the percentages to your facet and use a Forex Trading Pro System and you can experience currency trading success with it.
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Forex Trading Classes Help You To Avoid A Lot Of The Risks In Forex Trading (Forex Growth Bot)
It does take work and research to succeed. And even then, it is not possible to be expecting every business to be successful. Even the perfect traders lose on investments. The identify of the game is knowing when to chop your losses and pay consideration to the winners.
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Forex Growth Bot Trading Energy Markets – For Big Consistent Profits
Long run developments are easy methods to pass and there are plenty to focus on that can make triple digit gains. Take a look at those markets to increase your long run capital gains with some of the easiest commodity groups to trade.
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Forex Growth Bot Creating Wealth – A Simple Way For Mr Average To Get Rich
Its were given huge benefit potential to chance and land is cheap and simple to invest in – It is the perfect funding to generate profits fast!
By:
deyaflarnsl
Finance>
Investingl
Feb 12, 2011
Screen of the Week 01/25/2011: Find Stocks Poised for Positive Sales Surprises
Of the companies that have so far reported between the official start of this earnings season through the end of last week, 63% have reported positive earnings surprises while 68% reported positive sales surprises.
By:
Kevin Matras l
Finance>
Investingl
Jan 27, 2011
Screen of the Week 01/19/2011: Top Stocks with Big Potential Catch-Up Moves
Here is a screen I’ve been using recently. First, it focuses in on the top Zacks Ranked Sectors and Industries.
By:
Kevin Matras l
Finance>
Investingl
Jan 19, 2011
Screen of the Week 01/11/2011: Broker Triple Play
With a new year upon us, I was interested to see what the brokers were saying and what their best picks were.
By:
Kevin Matras l
Finance>
Investingl
Jan 13, 2011
Screen of the Week 12/14/2010: The Short Ratio
This week’s Screen looks at a market sentiment indicator called the ‘short ratio’ to find new stock picks.
By:
Kevin Matras l
Finance>
Investingl
Dec 16, 2010
Screen of the Week 11/30/2010: High Beta Stocks
I’ve written about low beta stocks before as a way to find stocks with lower volatility. But this week I want to focus on higher beta stocks as a way to increase your returns.
By:
Kevin Matras l
Finance>
Investingl
Nov 30, 2010
lViews: 101
Screen of the Week 10/26/2010: Price to Sales Ratio
This week, I’m going to focus on one of my favorite valuation metrics for determining a company’s under or overvaluation.
By:
Kevin Matras l
Finance>
Investingl
Oct 26, 2010
Screen of the Week 10/19/2010: Increasing Sales and Profit Margins
This week I want to focus on Sales Growth and Profit Margins.
By:
Kevin Matras l
Finance>
Investingl
Oct 21, 2010
Screen of the Week: 10/12/2010: Using the Price to Cash Flow to Find Value
The Price to Earnings ratio, or P/E, is probably the most common ratio in determining whether a company is undervalued or overvalued. However, the Price to Cash Flow, or P/CF, is another great ratio to do just that.
By:
Kevin Matras l
Finance>
Investingl
Oct 14, 2010
Add new Comment
Your Name: *
Your Email:
Comment Body: *
Verification code:*
* Required fields
Submit
Your Articles Here
It’s Free and easy
Sign Up Today
Author Navigation
My Home
Publish Article
View/Edit Articles
View/Edit Q&A
Edit your Account
Manage Authors
Statistics Page
Personal RSS Builder
My Home
Edit your Account
Update Profile
View/Edit Q&A
Publish Article
Author Box
Kevin Matras has 46 articles online
Articles Categories
All Categories
Advertising
Arts & Entertainment
Automotive
Beauty
Business
Careers
Computers
Education
Finance
Food and Beverage
Health
Hobbies
Home and Family
Home Improvement
Internet
Law
Marketing
News and Society
Relationships
Self Improvement
Shopping
Spirituality
Sports and Fitness
Technology
Travel
Writing
Accounting
Banking
Credit
Currency Trading
Day Trading
Debt Consolidation
Insurance
Investing
Loans
Mortgage
Personal Finance
Real Estate
Taxes
Wealth Building
]]>
Need Help?
Contact Us
FAQ
Submit Articles
Editorial Guidelines
Blog
Site Links
Recent Articles
Top Authors
Top Articles
Find Articles
Site Map
Mobile Version
Webmasters
RSS Builder
RSS
Link to Us
Business Info
Advertising
Use of this web site constitutes acceptance of the Terms Of Use and Privacy Policy | User published content is licensed under a Creative Commons License.
Copyright © 2005-2011 Free Articles by ArticlesBase.com, All rights reserved.