PEG Ratio History Chart

How to Read PEG Ratio History

The PEG ratio divides a stock's trailing P/E by its year-over-year EPS growth rate. Popularized by Peter Lynch in One Up on Wall Street, it adjusts the P/E for the growth rate that justifies it. A PEG below 1.0 suggests the market is paying less than one dollar for each percentage point of earnings growth — a classic undervaluation signal. A PEG above 2.0 implies the price already assumes high growth continues indefinitely.

Watching the PEG over time is more instructive than a single reading. A stock whose PEG has compressed from 3.0× to 0.8× may have become genuinely cheap — or its EPS growth may have spiked one-time on an easy compare. Context from the P/E historical chart and earnings history helps distinguish real repricing from noise.

Periods of negative or near-zero EPS growth are shown as N/A because the PEG formula breaks down when the denominator approaches zero — a negative PEG is mathematically meaningless. These gaps are normal for cyclical businesses at troughs; use the ROIC guide to assess whether the business model remains intact through the cycle.

The green/amber/red color coding makes it easy to spot regime changes at a glance: stretches of sustained green bars suggest a growth stock at a reasonable price; a multi-year red band means expectations were historically stretched. Neither guarantees future performance, but the historical context anchors your assumptions when building a DCF model.