Is AAR Corp. overvalued or undervalued?

As of 24 October 2025, the valuation grade for AAR Corp. has moved from very expensive to fair. Based on the current metrics, the company appears to be undervalued. Key ratios include a P/E ratio of 720, a Price to Book Value of 2.60, and an EV to EBITDA of 18.20, which suggest that the stock may be trading at a discount relative to its earnings potential.
In comparison to peers, AAR Corp. has a significantly higher P/E ratio than ATI, Inc. at 24.85 and Moog, Inc. at 40.73, indicating that it may be overvalued on an earnings basis despite the recent grade change. Notably, AAR Corp. has outperformed the S&P 500 across multiple time frames, with a year-to-date return of 41.12% compared to the S&P 500's 15.47%, reinforcing the notion that the stock is currently undervalued relative to its performance.