Is Axsome Therapeutics, Inc. overvalued or undervalued?

As of 9 August 2022, the valuation grade for Axsome Therapeutics, Inc. moved from does not qualify to risky, indicating a significant shift in perception. The company is currently considered overvalued. Key ratios highlight this concern, with a price-to-book value of 103.56 and an EV to EBITDA of -23.34, both suggesting excessive valuation relative to its financial performance. Additionally, the return on equity (ROE) stands at a staggering -464.66%, reflecting severe losses.
In comparison to peers, Axsome's valuation metrics are starkly unfavorable. For instance, Halozyme Therapeutics, Inc. is rated fair with a P/E ratio of 13.48 and an EV to EBITDA of 10.76, showcasing a much healthier financial standing. The stark contrast in these ratios underscores Axsome's overvaluation in the market. Despite a strong performance over the past year with a 33.07% return compared to the S&P 500's 10.26%, the underlying financial fundamentals suggest that the stock is not just risky but also overvalued at its current price of 101.65.