Is California Water Service Group overvalued or undervalued?

As of 17 October 2025, the valuation grade for California Water Service Group has moved from very expensive to expensive. The company appears to be overvalued, with a P/E ratio of 20, which is higher than its peers such as Essential Utilities, Inc. at 16.89 and SJW Group at 17.09. Additionally, the EV to EBITDA ratio stands at 12.46, again above the industry average, indicating a premium valuation compared to its competitors.
In terms of returns, California Water Service Group has underperformed relative to the S&P 500, particularly over the longer term, with a 1-year return of -9.58% compared to the S&P 500's 14.08%. This trend of underperformance, coupled with high valuation ratios, reinforces the conclusion that the stock is currently overvalued.