Is CenterPoint Energy, Inc. overvalued or undervalued?

As of 26 February 2025, the valuation grade for CenterPoint Energy, Inc. has moved from expensive to very expensive. This indicates that the company is currently overvalued. The P/E ratio stands at 24, which is higher than the industry average of approximately 23.4, while the EV to EBITDA ratio is 12.96, also above the peer average. Additionally, the PEG ratio of 14.90 suggests that the stock is priced significantly higher relative to its growth rate.
In comparison to its peers, Ameren Corp. has a P/E of 21.78 and EV to EBITDA of 14.01, while PPL Corp. shows a P/E of 24.36 and EV to EBITDA of 12.74. These figures further reinforce the notion that CenterPoint Energy is trading at a premium compared to similar companies in the sector. Notably, while the company has outperformed the S&P 500 on a year-to-date basis with a return of 14.31% compared to 2.44%, the overall valuation metrics suggest that investors may want to exercise caution given the current overvaluation.