Inverted PEG Ratio


This ratio is the opposite of the PEG ratio and allows for a better distribution. Growth companies with an inverted PEG above 2 are considered a bargain while companies withe a ratio below 0.5 are considered expensive. By sorting stocks in descending order, bargains show at the top while expensive companies or companies with negative earnings growth will show up at the bottom of the list.

The formula is as follows:

Inverted PEG Ratio = Earnings Growth 1y Price-to-Earnings Ratio 100