Is AAR Corp. overvalued or undervalued?

As of 22 August 2025, AAR Corp. has moved from an attractive to a fair valuation grade. The company appears to be overvalued based on its current metrics. The P/E ratio stands at 720, significantly higher than peers such as ATI, Inc. at 24.85 and Moog, Inc. at 40.73, indicating a potential pricing discrepancy. Additionally, the EV to EBITDA ratio of 18.20 and a Price to Book Value of 2.60 further suggest that AAR Corp. may be trading at a premium compared to its industry counterparts.
In terms of performance, AAR Corp. has delivered a year-to-date return of 23.91%, outperforming the S&P 500's 12.22% over the same period, and a remarkable 282.90% return over the past five years compared to the S&P 500's 96.61%. However, the high valuation ratios and the recent grade change indicate that the stock may not be a compelling investment at its current price of 75.93.