Validea’s Peter Lynch strategy is based on the investment philosophy of legendary fund manager Peter Lynch, who ran Fidelity’s Magellan Fund from 1977 to 1990. The strategy focuses on identifying companies with strong growth potential at reasonable prices, often referred to as “growth at a reasonable price” or GARP investing.
Key criteria in this strategy include a low price-to-earnings growth (PEG) ratio, which compares a stock’s price-to-earnings ratio to its earnings growth rate. Lynch favored companies with PEG ratios below 1.0. The strategy also looks for consistent earnings growth, low debt-to-equity ratios, and strong cash flow. Lynch was particularly interested in companies with “hidden” assets or potential catalysts for growth that the market may have overlooked.
Here are the top ten highest scoring stocks for September 2024 for Validea’s P/E/Growth Investor strategy based on Peter Lynch.
| Ticker | Company Name | P/E Growth Investor | Price | Mkt Cap ($Mil) | P/E | P/S | Rel. Strength | P/B | P/CF | Div. Yield | LT EPS Growth |
| AX | AXOS FINANCIAL INC | 100 | $61.43 | $3,495 | 8.0 | 3.0 | 84 | 1.5 | 7.3 | — | 25.7% |
| BBVA | BANCO BILBAO VIZCAYA ARGENTARIA SA (ADR) | 100 | $9.93 | $56,441 | 6.0 | 1.2 | 77 | 1.0 | 4.7 | 5.9% | 26.1% |
| EWBC | EAST WEST BANCORP INC | 100 | $78.28 | $10,850 | 10.0 | 4.2 | 84 | 1.5 | 8.6 | 2.8% | 18.0% |
| HCI | HCI GROUP INC | 100 | $94.65 | $991 | 7.6 | 1.4 | 92 | 2.2 | 5.6 | 1.7% | 33.7% |
| HG | HAMILTON INSURANCE GROUP LTD | 100 | $18.38 | $1,946 | 4.4 | 1.0 | 88 | 0.8 | 2.9 | — | 16.4% |
| HRTG | HERITAGE INSURANCE HOLDINGS INC | 100 | $15.18 | $466 | 7.8 | 0.6 | 98 | 1.8 | 6.9 | — | 33.6% |
| INMD | INMODE LTD | 100 | $16.90 | $1,289 | 9.8 | 3.1 | 16 | 1.9 | 8.6 | — | 34.5% |
| OFG | OFG BANCORP | 100 | $42.99 | $2,002 | 10.6 | 2.8 | 49 | 1.6 | 9.1 | 2.3% | 36.6% |
| OZK | BANK OZK | 100 | $39.66 | $4,500 | 6.6 | 2.8 | 49 | 0.9 | 6.1 | 4.0% | 22.2% |
| PERI | PERION NETWORK LTD | 100 | $8.35 | $404 | 5.4 | 0.6 | 43 | 0.6 | 4.3 | — | 37.6% |
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