Major indices finish lower amid GE earnings disappointment >>> READ MORE

3 High-Growth Value Stocks to Buy

If you peg PEG to value, you'll see these stocks are bargains

    View All  

grow185There are plenty of metrics to sort through when trying to dig up value stocks, but one in particular — “PEG” — can help you find hot growth amid the bargains.

Case in point: Qihoo 360 Technology (QIHU).

This Chinese stock has been the hottest Internet stock of the year. In 2013 alone, shares have soared nearly 170% — handily dwarfing rivals across the globe. And that has come on absolutely red-hot growth.

However, investors who haven’t jumped in yet are likely scratching their heads thanks to QIHU’s high valuation, which at a price-to-earnings ratio (P/E) of nearly 40 times expected 2014 profits, looks awfully pricey compared to its Chinese Internet peers.

That’s where PEG — or price/earnings-to-growth — comes in.

You see, as Barron’s points out, “much of Qihoo’s valuation lies within the growth value,” which is why Qihoo’s PEG — which not only factors in current earnings, but also it’s growth rate — is the better number to look at. A PEG above 1 signifies an overvalued stock, while under 1 signifies that it’s undervalued, thus QIHU’s PEG for 2013-15 of 0.5 is pretty attractive, and better than its peers’ average of 0.8.

But Qihoo isn’t the only growthy stock sitting pretty with a low PEG. Here are three other stocks that look like bargains when you consider the big growth they’re slated to post:

Article printed from InvestorPlace Media,

©2017 InvestorPlace Media, LLC