Is CARA Therapeutics, Inc. overvalued or undervalued?

As of 1 March 2022, CARA Therapeutics, Inc. has moved from a very attractive to a risky valuation grade, indicating a significant shift in its financial outlook. The company appears to be overvalued given its current financial metrics, including a price to book value of -33.03, an EV to EBIT of -9.00, and an EV to EBITDA of -9.05, all of which reflect negative performance and potential financial distress.
In comparison to its peers, CARA Therapeutics has a P/E ratio of -6.2350, while Immunome, Inc. and NGM Biopharmaceuticals, Inc. exhibit similar risk profiles with P/E ratios of -4.5533 and -0.9351, respectively. The stark contrast in valuation metrics, particularly the negative return on capital employed (ROCE) of -875.16%, further underscores the company's precarious position. Despite a strong one-year stock return of 154.51%, the overall financial indicators suggest that CARA Therapeutics is overvalued in the current market context.