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Penguin SolutionsPENG -7.81%68 Forward Rate of Return (Yacktman) % is 20.72% as of May. 2026. GuruFocus rates PENG with a GF Score™ of 68/100 and a GF Value™ of $25.58 (Significantly Overvalued). The stock has 5 warning signs investors should review. Among 1,372 Software companies, Penguin Solutions ranks better than 73.69% on this metric.
Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. Penguin Solutions's forward rate of return for was 20.72%.
The historical rank and industry rank for Penguin Solutions's Forward Rate of Return (Yacktman) % or its related term are showing as below:
PENG'
s Forward Rate of Return (Yacktman) % Range Over the Past 10 Years
Min: -16.01 Med: -3.07 Max: 23.5
Current: 20.82
During the past 11 years, Penguin Solutions's highest Forward Rate of Return was 23.50. The lowest was -16.01. And the median was -3.07.
PENG's Forward Rate of Return (Yacktman) % is ranked better than 73.69% of 1372
companies
in the Software industry
Industry Median: 13.365
vs PENG: 20.82
Unlike the Earnings Yield %, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
Penguin Solutions (NAS:PENG) Forward Rate of Return (Yacktman) % Explanation
Unlike the Earnings Yield, the Forward Rate of Return uses the normalized Free Cash Flow of the past five years, and considers growth. The forward rate of return can be thought of as the return that investors buying the stock today can expect from it in the future.
For the growth part of the Forward Rate of Return calculation, GuruFocus uses the 5-year average growth rate of EBITDA per share as the growth rate, and the growth rate is always capped at 20%. For the Free Cash Flow we use per share data averaged over five years. The reason we use five years is to make it comparable to the growth rate.
Be Aware
In the Forward Rate of Return calculation, the growth rate is added directly to today's free cash flow yield. Therefore the calculation is reliable only if the company can grow at the same rate in the future as it did in the past. Investors should pay close attention to this when researching growth stocks. A more accurate measurement for return is Return on Capital.
Penguin Solutions Forward Rate of Return (Yacktman) % Related Terms
Penguin Solutions Forward Rate of Return (Yacktman) % Historical Data
* Premium members only.
The historical data trend for Penguin Solutions's Forward Rate of Return (Yacktman) % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Penguin Solutions Forward Rate of Return (Yacktman) % Chart
PENG vs KD, PONY, CHRN: Forward Rate of Return (Yacktman) % Comparison
For the Information Technology Services subindustry, Penguin Solutions's Forward Rate of Return (Yacktman) %, along with its competitors' market caps and Forward Rate of Return (Yacktman) % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Penguin Solutions Forward Rate of Return (Yacktman) % vs Software Industry
For the Software industry and Technology sector, Penguin Solutions's Forward Rate of Return (Yacktman) % distribution charts can be found below:
* The bar in red indicates where Penguin Solutions's Forward Rate of Return (Yacktman) % falls into.
Penguin Solutions Forward Rate of Return (Yacktman) % Calculation
Forward Rate of Return is a concept that Don Yacktman uses in his investment approach. Yacktman explained the forward rate of return concept in detail in his interview with GuruFocus. Yacktman defines forward rate of return as the normalized free cash flow yield plus real growth plus inflation. He said in the interview (March 2012, when the S&P 500 was at about 1400):
If the business is stable, this calculation is fairly straightforward. For instance, on the S&P 500 we would normalize earnings. We would then calculate what percentage of those earnings are not reinvested in the underlying businesses and are therefore free. Historically, for the S&P 500, this has been just under 50% of earnings. Currently, we expect the S&P to earn about 70 on a normalized basis, a number which is far below reported earnings due to our adjusting for record high profit margins. $70 X ½ / 1400 gives you a normalized free cash flow yield of approximately 2.5%.
The historical real growth rate of the S&P 500 (companies) is about 1.5%. Assuming an inflation rate of 2.5%, the forward rate of return on an investment in the S&P 500 is about 6.5% today (2.5% free cash flow yield plus 1.5% real growth plus 2.5% inflation).
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
What does a Forward Rate of Return (Yacktman) % of 20.72% mean?
Penguin Solutions (PENG) has a Forward Rate of Return (Yacktman) % of 20.72% as of May. 2026. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Penguin Solutions and its competitors. According to the industry distribution chart, Penguin Solutions ranks #361 out of 1372 companies in the Software industry, placing it in the top 26.3%.
Is Penguin Solutions' Forward Rate of Return (Yacktman) % too high?
Penguin Solutions' current Forward Rate of Return (Yacktman) % is 20.72%. The Software industry median Forward Rate of Return (Yacktman) % is 13.37. Penguin Solutions' value of 20.72% is 55% above this industry median. Based on the distribution chart, Penguin Solutions ranks #361 out of 1372 companies in the Software industry, which is above the industry midpoint. Overall, Penguin Solutions has a GF Score™ of 68/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Penguin Solutions' Forward Rate of Return (Yacktman) % compare to KD and PONY?
According to the Software industry distribution chart, Penguin Solutions ranks #361 out of 1372 companies for Forward Rate of Return (Yacktman) %. This puts Penguin Solutions in the upper half of its industry. The industry median Forward Rate of Return (Yacktman) % is 13.37. Penguin Solutions' value of 20.72% is 55% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Forward Rate of Return (Yacktman) % for a Software company?
The median Forward Rate of Return (Yacktman) % among Software companies is 13.37, based on 1,372 companies in the industry. Companies in the top quartile (top 25%) have a Forward Rate of Return (Yacktman) % significantly above this median, while those in the bottom quartile fall well below. However, Forward Rate of Return (Yacktman) % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Penguin Solutions's current Forward Rate of Return (Yacktman) % of 20.72% is 55% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Forward Rate of Return (Yacktman) % mean?
A high Forward Rate of Return (Yacktman) % can signal that a stock is expensive relative to its fundamentals. Yacktman's forward rate of return equals the sum of normalized free-cash-flow yield plus earnings growth. View historical data on Penguin Solutions and its competitors. For the Software industry, the median Forward Rate of Return (Yacktman) % is 13.37 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Penguin Solutions's current Forward Rate of Return (Yacktman) % is 20.72%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Penguin Solutions stock overvalued right now?
Based on GuruFocus' analysis, Penguin Solutions (PENG) is currently considered Significantly Overvalued. The stock's GF Value™ is $25.58, compared to a current price of $53.85 — trading 110.5% above its estimated fair value. The current Forward Rate of Return (Yacktman) % is 20.72% and 55% above the Software industry median of 13.37. Penguin Solutions' overall GF Score™ is 68/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Forward Rate of Return (Yacktman) % calculated?
Forward Rate of Return (Yacktman) % is calculated from a company's financial statements. For Penguin Solutions (PENG), the current Forward Rate of Return (Yacktman) % is 20.72% as of May. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Penguin Solutions (PENG) Overvalued in 2026?
Based on GuruFocus' analysis, Penguin Solutions stock appears to be overvalued.
The current stock price of $53.85 is trading 110.5% above its estimated GF Value™ of $25.58.
GuruFocus considers Penguin Solutions to be Significantly Overvalued.
Key valuation signals for PENG:
Forward Rate of Return (Yacktman) %: 20.72%
GF Value™: $25.58 vs. price of $53.85 (110.5% above fair value)
Industry Position: 55% above the Software median (#361 of 1372)
No single metric tells the full story. See the PENG stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Penguin Solutions Inc is an end-to-end technology company engaged in Intelligent Platform Solutions, Integrated Memory, and Optimized LED business. Its product include Servers, software, OCP HPC & AI system, Racks and Edge. Servers include AMD-based Serves, Intel-based Servers, etc. Software products include Scyld ClusterWare, Scyld Cloud Central, etc. OCP HPC & AI Systems includes OCP Servers & Storage and etc.
68GF Score
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