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PEG Ratio Screener — Find Undervalued Growth Stocks
Mid and large-cap stocks ranked by PEG ratio (P/E ÷ EPS growth), cheapest first, with every row labeled by a valuation tier. Instantly see which growth companies trade below a PEG of 1.0 — then pair it with the P/E Ratio Screener and Revenue Growth Screener to confirm the growth is real.
How to Read the PEG Ratio
The PEG ratio answers a question the raw P/E cannot: is a stock expensive relative to how fast it is growing? It divides the price-to-earnings multiple by the earnings growth rate, so a company with a 20x P/E growing profits at 20% lands at a PEG of exactly 1.0 — the breakeven where you pay one point of multiple for each point of growth. Popularized by Peter Lynch, it is the single most useful way to compare a fast grower to a slow one on equal terms.
The valuation tier badge is the bookmark feature of this screener. Rather than making you compute PEG by hand, every row is labeled: Undervalued below 1.0, Fair Value for 1.0–2.0, Growth Premium for 2.0–3.0, and Overvalued above 3.0. Filter by sector or PEG tier and the labels stay put, so you can scan an industry and immediately see which growth stocks are attractively priced and which already discount years of expansion.
Read the PEG with two guardrails. First, the growth estimate: the ratio is only as reliable as the earnings-growth figure feeding it, so a wildly optimistic forecast produces a deceptively low PEG. Second, durability: a sub-1.0 PEG on a business whose growth is about to decelerate is not the bargain it appears to be. Always confirm the growth is real and repeatable — not a one-off rebound — before treating a low PEG as undervaluation.
PEG vs. P/E: Why Growth Matters
A P/E ratio in isolation tells you how many dollars you pay for a dollar of current profit, but it is blind to the future. Two companies can both trade at 25x earnings while one grows at 5% and the other at 25% — and the P/E treats them identically even though the faster grower is far cheaper for what you receive. The PEG ratio corrects this by folding growth into the multiple. That is why a stock that looks expensive on P/E alone can be reasonably priced on PEG, and why a low-P/E stock with no growth can carry a high, warning-flag PEG.
When a Low PEG Is a Trap
A PEG below 1.0 is not an automatic buy. The most common trap is an unrealistic growth estimate — analysts extrapolating a temporary surge that will not repeat, which deflates the ratio and makes an ordinary stock look cheap. A second trap is quality: high-growth companies often carry heavier execution and balance-sheet risk, and the market may be right to doubt the forecast. Always confirm the growth is durable, the estimate is grounded, and the business is financially sound before treating a low PEG as a genuine margin of safety.
Frequently asked questions
What PEG ratio is considered undervalued?
A PEG below 1.0 — the 'Undervalued' tier in this screener — is the classic signal that a stock is cheap relative to its earnings growth. But context matters: a 0.8 PEG built on a fragile or one-time growth spike is not the bargain it looks like. Always confirm the low PEG comes from durable, repeatable growth rather than an inflated estimate before treating it as undervaluation.
Why does the PEG ratio use growth as a percentage?
The PEG divides the P/E by the earnings growth rate expressed as a whole-number percentage, so 20% growth is treated as 20, not 0.20. That convention is what makes PEG = 1.0 the intuitive breakeven — a 20x P/E growing at 20% equals one. This screener stores growth as a percent and computes PEG the same way, so a stock's PEG lines up with the standard Peter Lynch definition.
How does this screener get its data?
The screener pulls a curated list of mid and large-cap stocks across sectors and fetches each company's trailing P/E, earnings growth, and market cap from Yahoo Finance. It computes the PEG ratio and valuation tier server-side, sorts cheapest first, and returns the top results. Companies without positive earnings and positive growth are excluded, and PEG outliers below 0.1 or above 10 are filtered out. Data refreshes hourly.
Can the PEG ratio be negative?
A stock with negative earnings or negative expected growth produces a negative or meaningless PEG, so the ratio simply does not apply. This screener excludes any company that lacks both positive earnings and positive EPS growth for exactly that reason. For unprofitable or shrinking companies, use a price-to-sales or EV/EBITDA screen instead, since those still work when earnings growth is absent.
Should I buy a stock just because it has a low PEG?
No. A low PEG is a valuation filter, not a buy signal on its own. The ratio depends entirely on the growth estimate, and an optimistic forecast can make an ordinary stock look cheap. Use this screener to build a shortlist of low-PEG names, then run a DCF, review earnings quality, and pressure-test the growth assumption before deciding. Click any ticker to open the full Basis Report analysis for that step.
How do I find the full analysis for a stock in the screener?
Click the ticker symbol to open the Basis Report stock intelligence page for that company. From there you can run a full DCF valuation, review earnings quality scores, see analyst ratings, and generate a complete research report. The PEG screener is the entry point; the full report gives you the depth to judge whether a low PEG reflects a real bargain or an overhyped growth story.