PE is the most widely used valuation metric. PEG adjusts PE for growth. Together they tell you whether you're paying a fair price for the earnings and growth you're getting.
PE RatioPEG RatioForward PEEarnings Yield
Live Result
166.67%
ฦ: pe / growth_rateraw: 1.66667
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ฦ(x)
Use variable names from the panel above (e.g. FV, r, n) โ or type numbers directly: 10000 / (1 + 0.08)^10
pe
Price-to-Earnings ratio
pe = 25
growth_rate
Expected 5-year EPS growth rate (%)
growth_rate = 15
price
Stock price
price = 100
eps
Earnings per share (trailing 12 months)
eps = 4
forward_eps
Expected EPS next year
forward_eps = 5
๐ก You can also enter values directly in the formula: 10000 / (1 + 0.08)^10
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โฌ Export Calculation
Exports a plain .txt file with your expression, formula, all variable values, result, and educational notes โ ready to paste into any report, Word doc, Notion, or Google Docs.
The exported file includes the formula in standard mathematical notation โ you can paste it directly into Excel, Google Sheets, or back into FinanceSheep.
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Learn: Comparing Stocks by Earnings: PE and PEG Ratios
Relative Valuation ยท Educational Guide
The Core Idea
Paying $25 for every $1 of current earnings seems expensive โ until you realise the company is growing 30% per year. PE without growth context is dangerous. PEG ratio solves this by dividing PE by the growth rate.
How It Works
PEG = PE / expected growth rate. PEG < 1 = potentially undervalued (paying less than $1 of PE per 1% of growth). PEG > 2 = potentially expensive. PEG = 1 is Peter Lynch's "fair value" benchmark โ but like all rules of thumb, context matters.
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Real-World Example: Stock A: PE = 10, growth = 3%. PEG = 10/3 = 3.3 โ expensive for slow growth. Stock B: PE = 30, growth = 25%. PEG = 30/25 = 1.2 โ much more reasonable. Stock C: PE = 20, growth = 20%. PEG = 1.0 โ "fair value" by Lynch's rule.