Is Capri Holdings Ltd. overvalued or undervalued?

As of 29 May 2024, the valuation grade for Capri Holdings Ltd. has moved from expensive to risky, indicating a deterioration in its financial standing. The company appears to be overvalued, particularly given its significant losses reflected in a P/E ratio that is not applicable, a Price to Book Value of 8.72, and an EV to EBITDA of 19.61. Comparatively, peers such as Gap, Inc. and Urban Outfitters, Inc. show more favorable valuations with P/E ratios of 10.22 and 13.77, respectively.
The company's financial metrics reveal concerning trends, including a ROE of -100.82% and a low ROCE of 2.74%. Furthermore, Capri Holdings has underperformed against the S&P 500, with a 1-year return of -44.92% compared to the index's 17.14%, highlighting the challenges it faces in the current market environment.