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8 Zulu Principle, low-PEG stocks

With a post-pandemic recovery in the offing, many PEG ratios look very low. The quality tests recommended by Jim Slater in his classic book The Zulu Principle offer a valuable way to sort the wheat from the chaff.
8 Zulu Principle, low-PEG stocks
  • Another 12 months of outperformance takes cumulative total returns from my Slater-inspired screen to 305 per cent over the past eight years versus 109 per cent from the market
  • The screen has identified eight shares for the year ahead
  • A detailed look at Best of the Best

Since vaccine breakthroughs were announced in November 2020, it’s been a wonderful time to be a small-cap investor. One of the stand out smaller companies screens that I run in this column is based on the wisdom of Jim Slater, an entrepreneur, investor and the author of classic investment book The Zulu Principle.

Slater was a proponent of the investment style that is broadly known as growth at a reasonable price (GARP). He did much to popularise the use of the price/earnings growth (PEG) ratio in the UK. And he was particularly drawn to smaller companies and their growth potential because, in his words, “elephants don’t gallop”.

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