In the equity market, investments need to be prudently hedged to overcome uncertainties and limit losses related to external shocks. A question that often arises is whether one should resort to a value strategy that seeks discounted stocks or opt for growth investing in times of extreme market instability.

The investment landscape has become increasingly challenging amid persistent inflation concerns, elevated Treasury yields, uncertainty over the Federal Reserve's monetary policy trajectory and geopolitical tensions. Recent weakness in AI-related stocks has added to market volatility, while the outcome of the U.S. midterm elections on Nov. 3 could influence expectations for fiscal policy, government spending and regulation.

Against this backdrop, investors may find it prudent to look beyond conventional value or growth strategies and focus on companies that combine reasonable valuations with sustainable earnings growth potential.

The investing track of the Oracle of Omaha over the past few decades and his gradual shift from being a pure-play value investor to a GARP (growth at a reasonable price) investor might give us all the answers.

Per the GARP theory, the strategic mingling of growth and value-investing principles gives us a hybrid strategy, offering an ideal investment by utilizing the best features of both. What GARPers look for is whether or not the stocks are somewhat undervalued and have solid, sustainable growth potential (Investopedia).

Several stocks that have surged significantly in recent years have demonstrated the overwhelming success of this hybrid investing strategy over pure-play value and growth investments. Here, we will discuss the success of four such stocks. These are APA Corporation (APA Quick QuoteAPA - Free Report) , T-Mobile US (TMUS Quick QuoteTMUS - Free Report) , BP plc (BP Quick QuoteBP - Free Report) and Centene (CNC Quick QuoteCNC - Free Report) .

A Few More Words on GARP

GARP investing gives priority to one of the popular value metrics, the price/earnings growth (PEG) ratio. Although it is categorized under value investing, this strategy follows the principles of both growth and value investing.

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

It relates the stocks’ P/E ratios to the future earnings growth rates.

While P/E alone gives an idea of stocks that are trading at a discount, PEG, the addition of the growth element to it, helps identify stocks with solid future potential.

A lower PEG ratio, preferably less than 1, is always better for GARP investors.

For example, if a stock's P/E ratio is 10 and the expected long-term growth rate is 15%, the company's PEG will come down to 0.66, a ratio indicating both undervaluation and future growth potential.

Unfortunately, this ratio is often neglected due to investors' limitations in calculating the future earnings growth rate of a stock.

There are some drawbacks to using the PEG ratio, though. It does not 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 be even more rewarding if some other relevant parameters are also taken into consideration.

Here are 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 of 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 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 Value Style Score of A or B, when combined with a Zacks Rank #1, 2 or 3 (Hold), offer the best upside potential.

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

Our PEG-Driven Picks

Here are four stocks that qualified for the screening:

APA: Texas-based APA, parent of Apache Corporation, explores, develops and produces crude oil, natural gas and natural gas liquids across the United States, Egypt and the U.K. North Sea, while holding exploration acreage in Suriname and other regions. Its key U.S. operations center on the Permian Basin, including the Midland and Delaware basins, with Alpine High offering potential for future production growth.

APA can be an impressive GARP investment pick with its Zacks Rank #2, a Value Score of A and a Growth Score of A. Apart from a discounted PEG and P/E, the stock has an impressive long-term historical growth rate of 31.4%.

T-Mobile: Headquartered in Bellevue, WA, T-Mobile provides wireless voice, messaging and data services across postpaid, prepaid and wholesale markets under the T-Mobile, Metro by T-Mobile and Mint Mobile brands. Strong third-quarter 2026 results, expanding 5G and broadband services, premium plan adoption, enterprise demand and fiber partnerships support growth, while robust cash generation supports continued dividends and share buybacks.

TMUS carries a Zacks Rank #2 at present, along with a Value Score of A and a Growth Score of B. T-Mobile also has an impressive five-year historical growth rate of 23.9%.

BP: This is a global integrated energy company focused on oil and gas production, refining, trading and lower-carbon energy, with a history of financial restructuring following the 2010 Deepwater Horizon disaster. BP’s current strategy prioritizes balance-sheet repair, portfolio simplification, cost discipline and shareholder returns, while upstream project growth, faster-than-planned deleveraging and structural cost reductions support cash generation.

BP stock can be an impressive GARP investment pick with its Zacks Rank #2, a Value Score of A and a Growth Score of A. Apart from a discounted PEG and P/E, BP has an impressive long-term expected growth rate of 13.6%.

Centene: This is a diversified healthcare services company providing managed-care services to government-sponsored programs, including Medicaid, Medicare and ACA Marketplace plans, through a capitated payment model. Serving approximately 27.6 million members across 50 states as of December 2025, Centene aims to drive profitable growth through geographic expansion, new Medicaid contracts, acquisitions and an enhanced medical management platform.

CNC can also be an impressive GARP investment pick with its Zacks Rank #2, a Value Score of A and a Growth Score of B. Apart from a discounted PEG and P/E, the stock also has a solid long-term expected growth rate of 32.7%.

You can see the complete list of today’s Zacks #1 Rank stocks here.