A PEG greater than 1 might be considered overvalued because it might indicate the stock price is too high compared to the company's expected earnings growth.
What's considered a good PEG ratio?
- PEG > 1: Overvalued (bad).
- PEG = 1: Fairly valued (good).
- PEG < 1: Undervalued (very good).
What does a high PE ratio tell you?
- The basic concept. The p/e's simplicity is also a pitfall. ...
- Variations on the theme. Other drawbacks are that the classic p/e uses last year's earnings figure,and it also only looks at one year,a problem when earnings are volatile ...
- There's no 'magic number' If you could get rich using one number,we'd all be doing it. ...
- A useful alternative: EV/Ebitda
What is a high pressure considered?
- What Is Considered High Barometric Pressure?A barometric reading over 30.20 inHg is generally considered high, and high pressure is associated with clear skies and calm weather. If the reading is over 30.20 inHg (102268.9 Pa or 1022.689 mb): Rising or steady pressure means continued fair weather. S
Is high PE ratio bad?
- There is no good or bad PE ratio. Most of the times, fundamentally sound businesses with strong balance sheets trade at high PE ratios. Some investors justify the expensive PE ratios of fast growth companies saying that if profits are growing 50% year-on-year then even a PE of 100 is cheap. See the table below.
The market average P/E ratio currently ranges from 20-25, so a higher PE above that could be considered bad, while a lower PE ratio could be considered better.