Is Builders FirstSource, Inc. overvalued or undervalued?

As of 24 October 2025, Builders FirstSource, Inc. has moved from a fair to an expensive valuation grade. The company appears overvalued based on its current metrics, with a P/E ratio of 13, a Price to Book Value of 2.82, and an EV to EBITDA of 8.52. In comparison to peers, Builders FirstSource's P/E ratio is significantly lower than Beacon Roofing Supply, Inc., which has a P/E of 20.51, indicating a potential overvaluation relative to its industry.
The company's recent performance shows a stark contrast to the S&P 500, with a year-to-date return of -13.20% compared to the S&P 500's 15.47%, and a one-year return of -31.71% against the S&P 500's 16.90%. This underperformance reinforces the view that Builders FirstSource is currently overvalued in the market.