Given the huge difference in what is value and what looks cheap due to one financial ratio, more often than not, relying on PE may lead to wrong investment decisions. It would be better to use the PEG ratio. Calculating it is a complex process and comes with its own set of challenges. The challenge with PEG ratio is the quality of the earning forecast and given that in an ever-changing macro environment, even the best of the forecast for any business can go wrong which may impact other elements which lead to some unexpected changes.