Is BJ's Restaurants, Inc. overvalued or undervalued?

As of 17 October 2025, BJ's Restaurants, Inc. has moved from expensive to very expensive, indicating a significant deterioration in its valuation grade. The company is overvalued, as evidenced by its P/E ratio of 43, which is substantially higher than its peers, such as Chuy's Holdings, Inc. at 19.29 and Portillo's, Inc. at 14.11. Additionally, BJ's has an EV to EBITDA ratio of 9.48, which, while lower than some peers, still reflects a premium valuation compared to the industry average.
In terms of returns, BJ's has underperformed against the S&P 500, with a year-to-date return of -12.74% compared to the S&P's 13.30%. Over the past three years, BJ's has managed a return of 12.80%, but this pales in comparison to the S&P 500's impressive 81.19% return during the same period. Overall, BJ's Restaurants, Inc. appears to be overvalued relative to its peers and the broader market performance.