Is Cathay General Bancorp overvalued or undervalued?

As of 3 October 2025, the valuation grade for Cathay General Bancorp has moved from fair to expensive, indicating a shift in perception regarding its market value. The company appears overvalued based on its current metrics, particularly with a P/E ratio of 13, which is higher than peers like Synovus Financial Corp. at 10.78 and Hancock Whitney Corp. at 12.21. Additionally, the Price to Book Value stands at 1.30, and the EV to EBIT is 7.20, further supporting the notion that the stock may be priced too high relative to its earnings and book value.
In terms of performance, Cathay General Bancorp has shown a YTD return of 1.47%, significantly lagging behind the S&P 500's return of 14.18% during the same period. Furthermore, over the last three years, while the stock has returned 21.96%, it still trails the S&P 500's impressive 82.57% return, highlighting concerns about its relative performance and valuation.