Message Font: Serif | Sans-Serif
 
No. of Recommendations: 0
Can you use the 3 year growth rate as it shows in the Fools Quote / Data section to calculate PEG? How does the number of years growth affect the final ratio? Should you recalculate the PEG each quarter to reflect the change in the P/E?

Still learning...thanks in advance.
Print the post Back To Top
No. of Recommendations: 0
>>>
Can you use the 3 year growth rate as it shows in the Fools Quote / Data section to calculate PEG?
How does the number of years growth affect the final ratio? Should you recalculate the PEG each
quarter to reflect the change in the P/E?

<<<

I wouldn't. What you have to remember is that the PEG (or Fool Ratio) is useful for small cap growth companies. These newer and/or smaller companies rarely have accurate long term growth numbers from analysts. Cetainly, I wouldn't expect any company with a market cap around $250 MM and only 3-4 analysts following it to have an accurate enough long term growth to plug into the PEG.

The Long Term Growth rate is used for the YPEG which you would use on larger growth companies.

http://www.fool.com/EveningNews/1996/EveningNews960809.htm
http://www.fool.com/EveningNews/1998/EveningNews980619.htm
http://www.fool.com/School/TheYPEGExplained.htm

Patrick
Print the post Back To Top
Advertisement