PEG ratio - what does it tell us? - MoneyWeek Investment Tutorials

After 11 years of posting this video, the knowledge is still so valuable

you teaching me more than my professor at this point tbh

sometimes you need to be ahead before market see's it , have you seen some stocks will have high PE with price hitting low value and once the earning kicks in , the PE gets adjusted automatically. Some stocks were bought at high PE as eps is not yet kicked in may be due to capex ,interest company paying cutting down their net profit/bottom line but once the debt is cleared or other expenditure ,eps will be visible. What we need to see what each individual company is doing and whether the revenue/topline is increasing or bussiness is scaling. Sometimes once the new capex or new line/products kicks in you can see the growth rate going high but for that you need to go deep in balance sheet earning calls etc

Excellent coverage of this topic, Sir.

Thanks!
The obvious follow up question: Is there a ratio that takes the pe or peg ratios and adjusts for expected dividends so as to bring dividend stocks under better comparison?

yea but the growth rate is completely made up... get an analyst who wants to spin a narrative will forecast make believe supporting "expected growth" ...

Very clear explanation, thanks so much. Do you have some videos where to look on for dividend stocks in particular ?

Very clearly explained. Thank you!

Wait a minute, how do you expect me to wrap my mind about what dividing a ratio by a percentage mean? I mean just mathemAtically, what does it mean? Also what theory underpins this PEG? In practice, I am interested in knowing how far apart P/e is from P/B; I achieve that by working out a ratio of P/e to P/book. In this way, I can then say how overpriced that share price in relation to the company’s indicator of networth without splitting hairs. Please respond. Thanks in anticipation.

sir, informative,presented very well

Thank you

Tim Bennett ❤️

What does a negative PEG ratio imply? Does it mean it's very low and, thus, attractive?

For example, I'm looking at a company with a trailing P/E ratio of 21, and a forward P/E ratio of 19. Yet, the PEG is -25.27. Doesn't the lower forward P/E ratio imply anticipated earnings growth? Why is the PEG ratio negative?

Best teacher ever

Sir, you really deserve more recognition. Thank you for all the information you are providing.

thank you, that helped me SO much!

Who came to the conclusion that 10% for a PE of 10 is good? 1. You yourself said all industries have different PE ratios so how can this ratio be standardised. 2. Again, what is the logic? @ If something had a PE of 100 and growth of 50% I'd consider that pretty good. I understand the math but not the reasoning. Did someone just say 10% is a good for a PE of 10? Please help.

one of the best teachers, clear and straight to the point explanation. Looking forward to more videos from you.

Sir Tim you explained it so well T_T

Hi. Q: If you buy a share with PEG=3 right now; and you expect the PEG goes further;8,9,10... That can be a posibility right? In fact Im talking about AMZ.
Nice job!

Sir I've a query..... Instead of taking Future EPS growth rate in the PEG Ratio, can we take Historical EPS growth rate in the PEG Ratio? Will this ratio better work with Historical EPS growth rate as compared to Future EPS growth rate?
Please give a reply to my query.
Thank you Sir.🙏

Thanks a lot Sir🙏

Excellent video. Thanks Tim!!

the more videos I watch the more I realize that nothing is actually useful lol

Thank you so much for this useful data! Greatly appreciated.

(10 / 20%) does not equal 0.5......indeed, it equals 50.0

chlorophyll... more like borophyll!.... zzzzz

Great video thanks

What about the negative PEG?

You explained the growth rate. So many other vids that explain PEG fail to explain the how you get the growth rate. By breaking this down you can then further explore the possible problems associated with tje PEG value.
Great video, makes you wonder why the others bother.

FOR NEW investor (noob) would you advice to focus on divident pay stocks?

That's really a good video. But you did growth rate of earnings by comparing forecast earnings, why can't we do see the growth of last 2-5 years and place over PEG?

Excellent.

Thank you. Very helpful.

Im from India. Tell me your email address.

How do these people estimate the earnings growth? Seems like something they pull out their ass

if we take average of Earning per share then why are not taking average of P/E during the same period ?

What about negative PEG ?

I am a big PEG fan, and hence I have a very important question. I have always used the 5 year PEG, as I agree with you it gives far more scope than the one year. I have applied that a value of 1 is good, above the stock needs further analysis. Above 2 not to buy. But someone and I think they are incorrect about this mentioned that if the PEG over 5 years is above 1 that is good, but if it above one for one year that is not good. There is not difference if the PEG is more than 1 for the 5 or 1 year PEG it is possibly overvalued. I have read and heard always a PEG of less than 1 for the 5 year is good not more than that. Thank-you.

Based on an original concept by jim Slater. Good video on PEG but not the whole story you need to decide. You need to consider the gearing of the company and also look at the directors share dealings, with these two additional pieces of info you have a much better picture.

Where do you find this information in order to make the calculations?

i dont understand if p/e=10  and growth rate is 20%  then why you divide 10/20 and not 10/0,2 ?

Good stuff, I've sat through many financial analysis classes and still can't remember what my tutor said, didn't help that he put me to sleep as soon as he opened his trap, thanks man.   Whats with all the other products being blogged on here? losers, make your own videos, I'll check out your other vids too, cheers mate

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