Value stocks are more likely to have a PEG ratio ________.

A) less than 1
B) equal to 1
C) greater than 1
D) less than zero

Question

Value stocks are more likely to have a PEG ratio ________.A)  less than 1B)  equal to 1C)  greater than 1D)  less than zero

Carla White · Accepted Answer

Final Answer : A, Explanation :  Value stocks are typically seen as undervalued by the market, which means their prices may not reflect their true potential for growth. As a result, value stocks tend to have a PEG ratio of less than 1, indicating that their price-to-earnings ratio is relatively low compared to their projected growth rate. A PEG ratio equal to 1 could indicate a fairly valued stock, while a PEG ratio greater than 1 could indicate an overvalued stock. A PEG ratio less than zero is not a meaningful metric.

Value stocks are more likely to have a PEG ratio ________.

A) less than 1
B) equal to 1
C) greater than 1
D) less than zero

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