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P/E, Earnings Growth & PEG Ratio

Calculate P/E and PEG using EPS and annual percentage growth, with optional EPS inputs and a retention-times-ROE growth estimate.

Formula & worked example
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How to use this calculator

Enter the known values in the units shown. Results update as you type.
Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

A price of 100 and EPS of 5 give P/E 20. Retaining 50 percent of earnings at ROE 20 percent implies growth of 10 percent and PEG 2.

P/E = share price/EPS; g = retention × ROE; PEG = P/E ÷ (100 × g)

Worked example

Enter these known values and leave the other values blank.

Price per share: 100 USD
Earnings per share: 5 USD
Share of earnings retained: 50 %
Annual return on equity: 20 %

Price-to-earnings multiple: 20 x
Annual EPS growth assumption: 10 %
P/E divided by growth percent: 2 x

Assumptions and limitations

Enter comparable price, EPS and annual growth assumptions. Earnings and share count must use the same reporting basis; the share count may be a weighted average.
Growth in this model equals the retained earnings fraction times ROE, assuming stable profitability and retention. An independently entered growth assumption can also solve the ratio.
PEG divides by growth expressed as a percentage number: 10 percent uses 10, not 0.10. Zero EPS or growth makes a denominator undefined.
Signed nonzero EPS and growth remain calculable, but PEG with losses or declining earnings is generally unsuitable for ordinary positive-growth comparisons. A ratio alone is not a valuation or investment recommendation.

Common questions

Why is P/E 20 divided by 10 rather than 0.10?

PEG convention uses the annual growth rate as a percentage number. Ten percent growth therefore gives 20/10 = 2.

Can I calculate EPS from total earnings?

Enable the EPS option, then supply earnings and a consistent positive share count.

References

Bookify rejects zero EPS and zero growth denominators while retaining signed nonzero arithmetic results.

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