Is Ark Restaurants Corp. overvalued or undervalued?

As of 18 December 2023, Ark Restaurants Corp. has moved from a valuation grade of very expensive to risky. The company is currently assessed as overvalued given its financial metrics and peer comparisons. The P/E ratio is not applicable due to losses, while the Price to Book Value stands at 0.95, indicating potential undervaluation on a book basis, but this is offset by an EV to EBITDA ratio of 6.15 and a ROCE of only 5.23%.
In comparison to its peers, Ark Restaurants Corp. shows a stark contrast with Nathan's Famous, Inc., which has a P/E of 42.68, and Potbelly Corp., which boasts a more favorable P/E of 9.45. The company's recent stock performance has lagged significantly behind the S&P 500, with a year-to-date return of -13.64% compared to the index's 2.44%. Overall, the combination of poor financial ratios and underperformance relative to peers suggests that Ark Restaurants Corp. is overvalued in the current market context.