Is Andretti Acquisition Corp. overvalued or undervalued?

As of 15 May 2024, the valuation grade for Andretti Acquisition Corp. has moved from does not qualify to risky, indicating a heightened level of concern regarding its financial health. The company is currently assessed as overvalued, primarily due to its negative P/E ratio of -0.0006 and an EV to EBITDA ratio of 0.17, which are significantly lower than industry norms. Additionally, the company's return on capital employed (ROCE) stands at an impressive 57.76%, but this is overshadowed by the negative book value reflected in its return on equity (ROE).
In comparison to its peers, Andretti Acquisition Corp. fares poorly against Inflection Point Acquisition Corp. II, which has an exorbitantly high P/E ratio of 161.53, and FTAC Emerald Acquisition Corp., which also carries a risky valuation with a P/E ratio of -9.97. The stark contrast in these ratios suggests that Andretti is not only underperforming but also potentially mispriced in the current market. Furthermore, the company's stock has seen a staggering decline of 98.29% over the past year, while the S&P 500 has gained 10.26%, reinforcing the notion of overvaluation amidst a broader market recovery.