Price/Earnings to Growth and Dividend Yield

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Price/Earnings to Growth and Dividend Yield

A ratio of a stock's valuation, that is, how expensive a stock is relative to its earnings and expected growth and the dividend yield. It is calculated as:

PEGY = Price/Earnings/(Projected Annual Earnings Growth per Share + Dividend Yield)

A lower ratio indicates a less expensive stock with higher earnings growth and dividends, while a higher ratio indicates the opposite. A PEGY may not be entirely accurate, as it is based on expected rather than actual growth. See also: PEG ratio.