10 S&P Stocks with the Highest PEG Ratios

Paul Giamou | Aurora | Getty Images

If you require an example of the high risk of high valuation, the past few weeks should be all the proof you need.

The huge drops in shares of Netflix, Vertex Pharmaceuticals, Green Mountain Coffee Roasters highlight the high-flyer danger.

Arguably, those names are a little different than most. They are all small or mid caps with high valuations that generated intense debate among traders both long and short the shares. Call them the kings of volatility.

They also proof that valuation still matters.

With that in mind, we thought it better to dig a little deeper into valuations of larger, more mainstream stocks, and our crack CNBC data team dug into the S&P 500 looking for the 10 stocks with the highest PEG ratios.

PEG is the short name for the price to earnings to growth ratio. New York University’s Stern School of Business defines it as the ratio of market price to expected growth in earnings per share. It was known as a favored starting point in valuation searches by famed investor Peter Lynch.

Like any of the screens on CNBC's "Street Signs," this should also just be considered a simple starting point for investors and more work should be done to dig into the "why" on these ratios.

That said, below is our list of the 10 stocks in the S&P 500 with the highest PEG ratios.

All data comes from Thomson Reuters.

Contact U.S. News


    Get the best of CNBC in your inbox

    Please choose a subscription
    Please enter a valid email address
    To learn more about how we use your information,
    please read our Privacy Policy.

Don't Miss

U.S. Video

  • Warren Buffett, Berkshire Hathaway chairman & CEO, shares his thoughts on American Express losing its exclusive deal with Costco and Berkshire's stake in the company. Also Buffett runs through Berkshire's top four holdings.

  • Warren Buffett, Berkshire Hathaway chairman & CEO, says there's no horse race to run Berkshire Hathaway, talking about world class managers, Ajit Jain and Greg Abel as possible successor to Buffett. And Buffett weighs in on troubles at Burlington Northern Railroad and improving the railway system.

  • Warren Buffett, breaks down Berkshire Hathaway's holdings. Also Buffett shares his thoughts on the performance of Burlington Northern Railroad.