Is Black Hills Corp. overvalued or undervalued?

As of 7 May 2025, the valuation grade for Black Hills Corp. has moved from fair to expensive, indicating that the stock is overvalued. The company exhibits a P/E ratio of 14, which is lower than some peers like Pinnacle West Capital Corp. at 24.26, but still suggests a higher valuation relative to its earnings. Additionally, the EV to EBITDA ratio stands at 10.73, while the industry average is not provided, making it difficult to assess relative performance directly against the sector.
In comparison to peers, Black Hills Corp. has a lower EV to EBIT ratio of 16.43 than OGE Energy Corp. at 17.83, yet it remains higher than the very attractive The AES Corp. at 12.64. The company's dividend yield of 4.29% is appealing, but the overall financial metrics suggest that it is overvalued. Over the past year, Black Hills Corp. has underperformed the S&P 500, with a return of -3.56% compared to the index's 17.14%, reinforcing the notion that the stock may not be a favorable investment at its current price.