Using the PEG framework with analyst consensus forward EPS growth of 15.6% plus 0.3% dividend yield, Alphabet Inc. has a fair value of $178.44 based on NTM EPS (FY2026) of $11.45. The current PEG ratio is 1.69.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG is most informative for high-growth companies — the PEG sweet spot.
| EPS Growth RateForward | 15.3% |
| Dividend Yield | +0.3% |
| Adjusted Growth (clamped 8–25%) | 15.6% |
| Fair P/E | 15.6x |
| NTM EPS (FY2026) | $11.45 |
| Fair Value | $178.44 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $10.81 | — | — |
| FY2026E | $11.45 | +6.0% | 40 |
| FY2027E | $13.43 | +17.3% | 38 |
| FY2028E | $15.56 | +15.8% | 25 |
| FY2029E | $18.55 | +19.3% | 12 |
| FY2030E | $22.03 | +18.7% | 12 |
5Y Forward EPS CAGR: 15.3%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $76.0B | $5.61 | — |
| FY2022 | $60.0B | $4.56 | -18.7% |
| FY2023 | $73.8B | $5.80 | +27.2% |
| FY2024 | $100.1B | $8.04 | +38.6% |
| FY2025 | $132.2B | $10.81 | +34.5% |
4Y Historical EPS CAGR: 17.8%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.