Is Benchmark Electronics, Inc. overvalued or undervalued?

As of 7 August 2025, the valuation grade for Benchmark Electronics, Inc. has moved from expensive to very expensive, indicating a significant shift in its market perception. The company appears to be overvalued, as evidenced by its P/E ratio of 23, which is notably higher than the peer average of approximately 30.08 for Littelfuse, Inc. and 43.33 for Advanced Energy Industries, Inc. Additionally, the EV to EBITDA ratio stands at 8.45, which is lower than some peers but still suggests a premium valuation relative to its earnings potential.
In comparison to its peers, Benchmark's valuation metrics reflect a challenging position, with a Price to Book Value of 1.24 and an EV to Capital Employed of 1.25, both indicating limited value creation relative to its market price. The recent stock performance shows that while Benchmark Electronics has outperformed the S&P 500 over the past week and month, it has significantly lagged over the year-to-date and one-year periods, with returns of -10.15% and -6.36%, respectively, compared to the S&P 500's 12.22% and 17.14%. This underperformance reinforces the notion that the stock may be overvalued in the current market environment.