Here's 10 quality companies with a PEG below 0.9x (undervalued)

The PEG ratio is an incredible metric to look at.

Here's 10 quality companies with a PEG below 0.9x (undervalued)

1. Uber | $Uber(UBER)$

Revenue growth: 17.9%

PEG: 0.70x

Net income margin: 57.6%

Commentary: A lot of the sentiment around $UBER today is purely down to the AV competition with $TSLA. Personally, I think $UBER will compete very well in the AV market if they partner with $TSLA or not. They have tons of growth avenues available to them outside of the AV market too.

2. PDD holdings | $PDD Holdings Inc(PDD)$

Revenue growth: 89.6%

PEG: 0.51x

Net income margin: 25.1%

Commentary: A Chinese company growing revenues at 89% yet trading at just 2.0x sales on paper is an absolute bargain. I personally own $BABA and that exposure to China is enough for me. I like $BABA for the diversity but $PDD is an excellent company too.

3. Pinterest | $Pinterest, Inc.(PINS)$

Revenue growth: 19.4%

PEG: 0.73x

Net income margin: 160.0%

Commentary: $PINS is a social media platform with 100% of revenue coming from advertising making this segment quite cyclical. They've got an incredibly low cost business model.

4. Toast | $Toast, Inc.(TOST)$

Revenue growth: 41.5%

PEG: 0.11x

Net income margin: 4.3%

Commentary: $TOST is a restaurant technology company providing cloud based software and hardware to help restaurants manage orders, payments, and operations. I don't personally love the margin profile or the avenues for growth but a PEG of 0.11x can't go unnoticed.

5. Micron Technology | $Micron Technology(MU)$

Revenue growth: 61.6%

PEG: 0.34x

Net income margin: 21.5%

Commentary: $MU comes up in almost every screen I do about undervalued companies to be honest and I have rarely delved much deeper than that. It's also not very talked about here on X for some reason despite the valuation. Any insights here are welcomed?

6. First Solar | $First Solar(FSLR)$

Revenue growth: 26.7%

PEG: 0.26x

Net income margin: 35.3%

7. Chart Industries | $Chart(GTLS)$

Revenue growth: 107.9%

PEG: 0.35x

Net income margin: 6.5%

Commentary: Chart Industries is a manufacturer of cryogenic equipment used for transportation, storage, and distribution of liquefied gas. I think the niche market plays can have huge benefits long term and $GTLS could quite easily be one of those at a 0.35x PEG.

8. The Cigna Group | $THE CIGNA GROUP(CI)$

Revenue growth: 26.6%

PEG: 0.78x

Net income margin: 2.2%

Commentary: $CI is a health services provider (health insurance, pharmacy benefits, and various other healthcare services). I don't know exactly what the moat is and I'm not a huge fan of the 2.2% NI margin but the PEG is favorable.

9. Nexttracker | $NEXTracker Inc(NXT)$

Revenue growth: 31.4%

PEG: 0.83x

Net income margin: 16.9%

Commentary: $NXT is a solar tracking company manufacturing single axis solar trackers that allow solar panels to follow the sun and improve the efficiency of solar farms.

An EV/Sales of 2.0x for 31.4% is quite favorable. If you're bullish on solar then this could be a nice play.

10. SentinelOne | $S

Revenue growth: 47.1%

PEG: 0.85x

Net income margin: -37.2%

Commentary: $S is the only company on this list that isn't profitable. I've been saying for a while that I think $S is a better play than $CRWD when you take into account valuations. That thesis hasn't played out yet but I do think $S has some strong potential.