Is Array Technologies, Inc. overvalued or undervalued?

As of 7 November 2024, the valuation grade for Array Technologies, Inc. has moved from expensive to risky, indicating a shift in perception regarding its market value. The company appears to be overvalued based on its current metrics, with a P/E ratio of 11, an EV to EBITDA of 8.91, and a Price to Book Value of 3.54. In comparison, peers such as Fabrinet have a significantly higher P/E ratio of 41.84, while MACOM Technology Solutions Holdings, Inc. shows a risky valuation with a P/E of 73.15.
Despite a strong year-to-date return of 33.28% compared to the S&P 500's 12.22%, the longer-term performance reveals a concerning trend, with a three-year return of -54.83% against the S&P's 70.41%. This suggests that while Array Technologies has had a brief resurgence, its overall valuation remains precarious in the context of its peers and historical performance.