Is Barnwell Industries, Inc. overvalued or undervalued?

As of 11 August 2023, Barnwell Industries, Inc. has moved from a fair to a risky valuation grade, indicating a significant downgrade in its financial outlook. The company is currently considered overvalued based on its financial metrics, particularly given its negative P/E ratio and a troubling ROCE of -46.94%. The Price to Book Value stands at 1.26, while the EV to EBITDA is at 11.49, suggesting that the market is pricing the company at a premium despite its losses.
In comparison to its peers, Barnwell's valuation appears unfavorable. For instance, Tellurian, Inc. has a P/E ratio of -6.2987 and an EV to EBITDA of -26.1054, while Riley Exploration Permian, Inc. is rated fair with a P/E of 4.9840 and an EV to EBITDA of 3.1835. The stark contrast in these ratios highlights Barnwell's overvaluation relative to its industry. Additionally, the company's stock has underperformed significantly against the S&P 500, with a one-year return of -44.02% compared to the index's 10.26%.