Is Apollo Commercial Real Estate Finance, Inc. overvalued or undervalued?

As of 24 April 2025, the valuation grade for Apollo Commercial Real Estate Finance, Inc. has moved from risky to very attractive, indicating a significant improvement in its perceived value. The company appears to be undervalued based on its current metrics. Key ratios include a P/E ratio of 174, a price to book value of 0.74, and an EV to EBITDA of 2.50, which suggest that the stock is trading at a discount relative to its earnings potential.
In comparison to peers, Apollo Commercial Real Estate Finance, Inc. has a much more favorable valuation with a P/E of 169.66 compared to Veris Residential, Inc. at -57.83 and Ready Capital Corp. at -2.03. Additionally, Apollo's PEG ratio of 1.61 is more attractive than its peers, indicating better growth prospects relative to its price. Despite recent underperformance against the S&P 500 over one year, the company's strong dividend yield of 871.60% and ROCE of 28.10% highlight its potential for future growth, reinforcing the conclusion that it is currently undervalued.