Is Brookfield Renewable Corp. overvalued or undervalued?

As of 2 May 2025, the valuation grade for Brookfield Renewable Corp. has moved from very attractive to risky, indicating a shift in perception regarding its investment potential. Based on the available metrics, the company appears to be overvalued, particularly when considering its P/E ratio of -3.76, which is significantly below the industry average. Additionally, the EV to EBITDA ratio stands at 8.14, which does not favorably compare to peers, suggesting that the company may not be generating sufficient earnings relative to its valuation.
In comparison to its peers, Brookfield Renewable Corp. is underperforming, with its P/E ratio being notably lower than the industry standard, while its EV to EBITDA is also less favorable. The stock has shown mixed performance against the S&P 500, with a year-to-date return of 25.23% compared to the S&P 500's 12.22%, but it has lagged over longer periods, such as the 3-year and 5-year returns, where it posted declines of -13.90% and -0.10%, respectively. This trend reinforces the notion that the stock may be overvalued given its recent performance and valuation metrics.