Is Daktronics, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Daktronics, Inc. has moved from fair to very expensive, indicating that the stock is overvalued. The company exhibits a P/E ratio of 23, a Price to Book Value of 2.62, and an EV to EBITDA of 8.73, which are significantly higher than its peers, such as Advanced Drainage Systems, Inc. with a P/E of 27.44 and Brady Corp. with a P/E of 21.28. This suggests that Daktronics is trading at a premium compared to its industry counterparts.
The recent performance of Daktronics shows a strong 1-year return of 42.60%, outpacing the S&P 500's return of 14.08%, and a remarkable 3-year return of 578.82% compared to the S&P 500's 81.19%. Despite these impressive returns, the high valuation ratios indicate that the stock may not be a sustainable investment at current levels.