Valuation check: CPRI's PEG ratio is 52.6, above the Consumer Cyclical sector average of 8.36.
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The PEG ratio measures a stock's valuation relative to its earnings growth rate. A PEG ratio below 1.0 may indicate that the stock is undervalued relative to its growth potential.
Capri Holdings posts a PEG ratio of 52.6. That is above the Consumer Cyclical sector average of 8.36. Comparing that reading with peers and prior periods is usually more useful than looking at the number in isolation.
For Consumer Cyclical stocks, a PEG ratio near 8.36 is typical. Capri Holdings's 52.6 is higher that level. That is roughly 529.5% above the sector mean. Whether that is a warning or an opportunity depends on growth outlook and other fundamentals shown elsewhere on Stockcircle.
Capri Holdings's PEG ratio of 52.6 comes from dividing a price-based measure by a related financial statistic. Changes can come from the stock price moving, the underlying fundamental shifting, or both. Track both the level and the trend — a rising multiple on falling fundamentals is a different story than a rising multiple on rising earnings.
Context for CPRI's PEG ratio usually means three checks: (1) trend versus prior periods, (2) level versus peers (average 8.36), and (3) consistency with growth and profitability. This page covers the first two; Capri Holdings's other metric pages and overview cover the third.
Judging Capri Holdings against Consumer Cyclical peers is usually better than using a market-wide rule of thumb. Business models inside Consumer Cyclical are more comparable, which makes gaps in PEG ratio easier to interpret. Start with 52.6 here, then scan peer and history charts to see if the gap is persistent.