What is the PEG valuation method?

PEG = P/E ratio / earnings growth rate. A PEG below 1 typically indicates undervaluation, PEG = 1 suggests fair valuation, and PEG above 1 may indicate overvaluation. Championed by Peter Lynch, it provides a more complete picture than P/E alone.

When is the P/S ratio useful?

P/S ratio = market cap / revenue. It is most useful for high-growth companies that are not yet profitable (e.g., SaaS startups). A P/S below 2 is generally considered inexpensive, while P/S above 10 requires very high growth expectations to justify.

What matters most when valuing growth stocks?

The key metrics in order of importance are: revenue growth rate, profit growth rate, PEG, and P/S ratio. The core logic of growth stock investing is using future high growth to justify current high valuation, so growth rate is the key driver.

Growth Stock Valuation Calculator - PEG/PS/PB

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Revenue Growth Rate (%)

Earnings Growth Rate (%)

Revenue Per Share ($)

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📈 Growth Stock Valuation Calculator

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Valuation Report

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