Is Battalion Oil Corp. overvalued or undervalued?

As of 31 March 2025, Battalion Oil Corp. has moved from an expensive to a risky valuation grade. The company appears to be overvalued given its negative Price to Book Value of -12.52 and a high EV to EBIT ratio of 36.79, which indicates that investors are paying a premium for earnings that are not currently realized. Additionally, the EV to EBITDA ratio of 5.70 suggests that the company's operational efficiency is not translating into value for shareholders.
In comparison to its peers, Battalion Oil Corp. has a significantly lower EV to EBITDA ratio than SilverBow Resources, Inc. at 3.93 and SandRidge Energy, Inc. at 3.67, both of which are rated more favorably. The company's recent performance has been poor, with a year-to-date return of -37.79%, starkly contrasting with the S&P 500's positive return of 12.22% over the same period, reinforcing the notion that the stock is not only risky but also overvalued in its current state.