BUSINESSWEEK ONLINE : JUNE 26, 2000 ISSUE
COVER STORY Using PEG to Pick Stocks A good way to find companies with strong expected growth that are selling at reasonable prices is to use PEG, a comparison of a company's price-earnings ratio to its estimated annual growth rate over a five-year period. PEG is often expressed as a ratio, the p-e divided by the growth rate. The lower the ratio, the cheaper the stock relative to its growth prospects. The following stocks look good in terms of their PEG ratios. COMPANY PEG APACHE APA .47 APPLIED MATERIAL AMAT 1.29 BEST BUY BBY 1.26 CIGNA CI .98 CITIGROUP C 1.31 FEDERAL EXPRESS FDX 1.21 GTE GTE 1.43 TARGET GROUP TGT 1.21 TEXACO TX 1.37 UNITED HEALTH GROUP UNH 1.12 DATA: MORGAN STANLEY DEAN WITTER _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _					RELATED ITEMS The Right Stocks for a Slowing Economy TABLE: Using PEG to Pick Stocks For the Record: Mary Farrell Introduction Economic Outlook Washington Outlook Asset Allocation The Stock Market Tech Stocks Defensive Investing Stocks to Avoid European Equities Asian Stocks Latin American Stocks Bonds Commentary Mutual Funds Tax Tips INTERACT E-Mail to Business Week Online

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