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Hi Vincent,
There is a linkage between PE & PEG. Since the company is trading at PE20 and investor is expecting the company to grow 20% or more. If you link it back to PEG the PE is 20 and the growth is 20% which give a PEG of 1 (20/20) which means fair valuation. But if the company is able to grow 40% the PEG is 0.5 (20/40) which means investor felt that the company in future will be undervalue so they are willing to pay a higher PE because that they are expecting 40% growth in the future. Alternately, if the investor felt that the company don;t have much growth in the future they are usually traded at single digit PE.