It's peak. Universal motors (the kind in shop vacs, drills, routers, sanders, etc) are usually rated in peak HP for routers and shop vacs and craftsman's benchtop saws. Pay attention to the amp rating instead. I know a 15 amp router may not seem all that much more powerful than a 12 amp one, but the difference is in the construction and size of the motor in general. There's a reason why 3+HP routers weigh 16lbs.
Basically follow amp ratings for universal type motors.