Is California Water Service Group overvalued or undervalued?

As of 31 October 2025, the valuation grade for California Water Service Group moved from very expensive to expensive, indicating a slight improvement in perceived value. The company appears to be overvalued based on its current metrics, with a P/E ratio of 20, an EV to EBITDA ratio of 12.46, and a Price to Book Value of 1.67. In comparison to peers, Essential Utilities, Inc. has a lower P/E of 16.89, while American States Water Co. has a higher P/E of 22.76, suggesting that California Water Service Group's valuation is not justified relative to its competitors.
The company has underperformed significantly against the S&P 500, with a year-to-date return of -2.10% compared to the S&P 500's 16.30%, and a three-year return of -28.49% versus 76.66% for the index. This underperformance reinforces the notion that the stock may be overvalued in the current market environment.