Is Arlo Technologies, Inc. overvalued or undervalued?

As of 27 August 2018, Arlo Technologies, Inc. has moved from a grade of "does not qualify" to "risky," indicating a significant shift in its valuation outlook. The company appears to be overvalued given its current financial metrics, with a P/E ratio of -90.81 and an EV to EBITDA ratio of -77.02, both of which reflect its loss-making status. Additionally, the Price to Book Value stands at 16.79, suggesting a premium over its book value despite negative returns on equity of -19.03%.
In comparison to its peers, Digi International, Inc. has a fair valuation with a P/E ratio of 34.21, while Harmonic, Inc. shows a more reasonable P/E of 12.68. This stark contrast highlights Arlo's overvaluation in the context of its industry. Notably, while Arlo has outperformed the S&P 500 over various time frames, including a 48.88% year-to-date return compared to the S&P 500's 2.44%, the underlying financial metrics suggest that the stock is not justified at its current price level.