Is AMC Entertainment Holdings, Inc. overvalued or undervalued?

As of 27 February 2020, the valuation grade for AMC Entertainment Holdings, Inc. moved from very attractive to risky, indicating a significant deterioration in its investment appeal. The company is currently overvalued, as evidenced by its negative price-to-book value of -0.85 and an EV to EBIT ratio of -136.08, which suggests severe operational challenges. Additionally, the EV to EBITDA ratio stands at 20.61, indicating that the market is pricing the company at a high multiple relative to its earnings potential.
In comparison to its peers, AMC's valuation metrics are concerning; for instance, Churchill Downs, Inc. has a fair P/E ratio of 16.46, while Cinemark Holdings, Inc. boasts a very attractive EV to EBITDA of 8.09. The stark contrast in these ratios highlights AMC's struggles within the industry. Furthermore, the company's stock has underperformed significantly against the S&P 500, with a year-to-date return of -28.64% compared to the index's 12.22%, reinforcing the notion of its overvaluation.