Is Chimera Investment Corp. overvalued or undervalued?

As of 3 August 2023, the valuation grade for Chimera Investment Corp. has moved from risky to very attractive, indicating a significant improvement in its perceived value. The company appears to be undervalued, especially when considering its P/E ratio of 5, which is substantially lower than peers like LTC Properties, Inc. at 17.18 and Getty Realty Corp. at 21.89. Additionally, Chimera's price-to-book value stands at 0.42, suggesting that the stock is trading well below its intrinsic value.
In terms of profitability, Chimera boasts a robust ROCE of 30.19% and a high dividend yield of 26.64%, which further supports its attractive valuation. The EV to EBITDA ratio of 1.17 is also competitive compared to industry standards. Despite recent underperformance against the S&P 500, with a year-to-date return of -1.64% compared to the index's 2.44%, the overall metrics indicate that Chimera Investment Corp. is a compelling investment opportunity at its current price of 13.77.