Is Blue Foundry Bancorp overvalued or undervalued?

As of 26 July 2023, Blue Foundry Bancorp's valuation grade has moved from fair to risky, indicating a concerning shift in its financial health. The company appears to be overvalued, particularly given its Price to Book Value of 0.60 and an EV to Capital Employed ratio of 0.78, which suggest that the market may not be accurately reflecting the company's underlying value. Additionally, the negative ROCE of -2.37% and ROE of -3.60% further highlight the challenges the company is facing.
In comparison to its peers, TrustCo Bank Corp. NY has a P/E ratio of 14.54, while Southern Missouri Bancorp, Inc. boasts a more attractive valuation with a P/E of 11.64. These ratios underscore the relative overvaluation of Blue Foundry Bancorp in the current market. Notably, the company's stock has underperformed against the S&P 500 over various periods, with a year-to-date return of -1.33% compared to the S&P 500's 12.22%, reinforcing the notion that the stock may not be a favorable investment at this time.