Is Beam Therapeutics, Inc. overvalued or undervalued?

As of 28 February 2022, the valuation grade for Beam Therapeutics, Inc. moved from does not qualify to risky. The company is currently overvalued based on its financial metrics. Key ratios include a Price to Book Value of 1.66, an EV to Sales ratio of 10.40, and a ROE of -34.16%. In comparison to peers, Blueprint Medicines Corp. has a significantly higher EV to EBITDA of -53.3160, while Arrowhead Pharmaceuticals, Inc. shows an EV to EBITDA of -40.5602, indicating that Beam's valuation is not justified relative to its industry peers.
Despite a strong 1-week return of 16.47% compared to the S&P 500's 1.05%, the longer-term performance reveals a concerning trend, with a 3-year return of -55.27% versus the S&P 500's 70.41%. This suggests that while there may be short-term gains, the overall valuation remains unsustainable in the context of its financial performance.