Scan 5,000+ stocks daily for Peter Lynch GARP tenbagger candidates. PEG ratio, earnings growth, and valuation discipline applied. Each setup graded A+ to B.
Run this scan →Peter Lynch's Growth at a Reasonable Price methodology is built on a deceptively simple insight: the best investments are companies with strong, predictable earnings growth that the market has not yet fully priced in. During his tenure managing Fidelity's Magellan Fund from 1977 to 1990, Lynch used this approach to achieve a 29.2% average annual return — one of the greatest track records in investing history.
The centerpiece of Lynch's methodology is the PEG ratio — the price-to-earnings ratio divided by the earnings growth rate. A PEG of 1.0 means a stock is fairly valued relative to its growth. A PEG below 1.0 suggests the market is underpricing the company's growth, creating an opportunity. Lynch particularly favored stocks with PEG ratios below 0.75, which he considered significantly undervalued.
Beyond the PEG ratio, Lynch emphasized understanding the business behind the numbers. He categorized stocks into six types — slow growers, stalwarts, fast growers, cyclicals, turnarounds, and asset plays — and applied different criteria to each. Our scanner focuses on the fast growers and stalwarts that most closely align with the GARP philosophy: companies with 15-30% earnings growth, reasonable valuations, consistent revenue growth, and business models that can be understood by studying the product or service they provide.
Developed by Peter Lynch during his management of Fidelity's Magellan Fund from 1977 to 1990, where he achieved a 29.2% average annual return — making Magellan the best-performing mutual fund in the world. Lynch published his methodology in One Up on Wall Street (1989) and Beating the Street (1993). The PEG ratio, which Lynch popularized as the centerpiece of GARP investing, was later adopted broadly by Wall Street analysts and is now reported by most financial data services.
Our scanner evaluates the following criteria when detecting Peter Lynch GARP — Growth at Reasonable Price setups across 5,000+ stocks daily.
For GARP setups, an A+ grade means a PEG ratio below 0.75 with earnings growing 20%+ annually, consistent revenue growth, and reasonable valuation relative to the sector. This is not a prediction of future price movement — it is a way to prioritize which charts deserve your attention first.
Buy when a company has a PEG ratio below 1.0 (ideally below 0.75) with confirmed earnings growth of 15%+ annually, consistent revenue growth, and the stock is not overextended technically.
Use a fundamental stop — if earnings growth decelerates below 15% or the PEG ratio expands above 1.5, reevaluate the position. Technical stop at 15-20% below entry for risk management.
Lynch's tenbagger methodology implies holding for years. The target is a doubling or more of the investment as the market gradually recognizes the undervalued growth. Review the position quarterly.
This is educational content only. Not financial advice. Always do your own research and manage risk appropriately.