Is Balchem Corp. overvalued or undervalued?

As of 12 June 2025, Balchem Corp. has moved from a fair to an expensive valuation grade. The company is currently considered overvalued based on its financial metrics. The P/E ratio stands at 40, significantly higher than the peer average of 25.39 for Lancaster Colony Corp., which is rated attractive. Additionally, Balchem's EV to EBITDA ratio of 28.90 also exceeds the peer average of 15.80, indicating a premium valuation compared to its peers.
In terms of other key ratios, Balchem's Price to Book Value is 4.50, and its ROCE is 14.27%. These figures suggest that while the company maintains a decent return on capital, its valuation multiples are elevated relative to industry standards. Notably, Balchem's recent stock performance has lagged behind the S&P 500, with a year-to-date return of -2.43% compared to the index's 2.44%, reinforcing the view that the stock may be overvalued at its current price of 159.04.