When one's pants are dropped so low (usually from something called "sagging") that they waddle like a penguin when they walk.
What would really give a full effect to this term is if one is using this "penguin swag" and is wearing a black/white shirt, black/white pants, and a nice yellow hat.
*Bob drops pants to his ankles and attempts to walk*
Bob: Dude check out my penguin swag!"
A hip style of transportation by foot that resembles a penguin walking. Usually done as a result of one's trousers descending.
Jeremiah and Ricardo looking fly with their penguin swag on.