At a time when volatility strikes every second day, investors often rely on value investing rather than other options like growth or momentum. As soon as other investors start selling their stocks at a cheaper rate in times of market uncertainty, value investors take this as an opportunity to pick good stocks at a discounted price.

Several stocks that have surged significantly in the recent past have shown the overwhelming success of this pure-play investment strategy. Here, we discuss four such stocks — Signet Jewelers (SIG Quick QuoteSIG - Free Report) , Micron Technology (MU Quick QuoteMU - Free Report) , Marathon Petroleum (MPC Quick QuoteMPC - Free Report) and International Seaways (INSW Quick QuoteINSW - Free Report) .

However, this apparently simple value investment technique has some drawbacks and not understanding the strategy properly may often lead to “value traps.” In such a situation, these value picks start to underperform over the long run as the temporary problems, which once drove the share price down, turn out to be persistent.

There are many value investment yardsticks, such as dividend yield, P/E or P/B, which are simple and can single out whether a stock is trading at a discount.

However, for investors looking to escape such value traps, it is also vital to determine where the stock would be headed in the next 12 to 24 months. Warren Buffett advises these investors to focus on the earnings growth potential of a stock. This is where lies the importance of a not-so-popular value investing metric, the PEG ratio.

PEG Ratio at a Glance

The PEG ratio is defined as (Price/ Earnings)/Earnings Growth Rate

A low PEG ratio is always better for value investors.

While P/E alone fails to identify a true value stock, PEG helps find the intrinsic value of a stock.

There are some drawbacks to using the PEG ratio. It doesn’t consider the very common situation of changing growth rates, such as the forecast of the first three years at a very high growth rate, followed by a sustainable but lower growth rate over the long term.

Hence, PEG-based investing can turn out to be even more rewarding if some other relevant parameters are also taken into consideration.

Here are some of the screening criteria for a winning strategy:

PEG Ratio less than X Industry Median

P/E Ratio (using F1) less than X Industry Median (for more accurate valuation purposes)

Zacks Rank #1 (Strong Buy) or 2 (Buy) (Whether good market conditions or bad, stocks with a Zacks Rank #1 or 2 have a proven history of success.)

Market Capitalization greater than $1 billion (This helps us to focus on companies that have strong liquidity.)

Average 20-Day Volume greater than 50,000 (A substantial trading volume ensures that the stock is easily tradable.)

Percentage Change F1 Earnings Estimate Revisions (4 Weeks) greater than 5% (Upward estimate revisions add to the optimism, suggesting further bullishness.)

Value Score of less than or equal to B: Our research shows that stocks with a Style Score of A or B when combined with a Zacks Rank #1, 2 or 3 (Hold) offer the best upside potential. 

Our PEG-Driven Picks

Here are four stocks that qualified the screening:

Signet: Bermuda-based Signet Jewelers operates 2,534 stores across North America and internationally, including Kay Jewelers, Zales, Jared and Blue Nile. In fiscal second-quarter 2027, North America sales reached $1.43 billion, with same-store sales up 1.9%. International sales totaled $96.6 million, up 6% on a same-store basis, as Signet advanced brand-strengthening initiatives.

Signet currently has a Zacks Rank #1 and a Value Score of A. SIG also has an impressive five-year expected growth rate of 15.6%.

Micron: Idaho-based Micron is a leading global provider of DRAM, NAND, NOR flash and advanced memory and storage solutions for computing, mobile, automotive and data center markets. AI-driven demand, tight supply, premium high-bandwidth memory (HBM) products and data center SSDs support pricing, margins and cash generation, while expanding edge AI and physical AI applications strengthen long-term growth prospects.

Micron currently has a Zacks Rank #1 and a Value Score of B. MU also has an impressive five-year historical growth rate of 66%. You can see the complete list of today’s Zacks #1 Rank stocks here.

Marathon Petroleum: Findlay, OH-based Marathon Petroleum is a leading U.S. refiner, transporter and marketer of petroleum products, operating through Refining & Marketing, Midstream and Renewable Diesel segments. Its refining network comprises 13 refineries with approximately 3 million barrels per day of combined crude processing capacity, while MPLX-led midstream operations support integrated energy transportation, storage and processing across the United States.

Apart from a discounted PEG and P/E, MPC currently has a Zacks Rank #1 and a Value Score of B. MPC has a long-term expected growth rate of 53.3%.

International Seaways: New York-based International Seaways provides global ocean transportation of crude oil and refined petroleum products through a diversified tanker fleet operating across spot and time-charter markets. Strong tanker fundamentals, geopolitical trade disruptions and limited fleet supply support earnings and cash flow, while disciplined fleet renewal, selective chartering, a solid balance sheet and shareholder returns strengthen its investment outlook.

INSW has a Zacks Rank #1 and a Value Score of B. International Seaways also has an impressive five-year historical growth rate of 41.4%.