Is Datasea, Inc. overvalued or undervalued?

As of 11 February 2022, Datasea, Inc. has moved from a grade of "does not qualify" to "risky." The company is currently overvalued based on its financial metrics. Key ratios include a Price to Book Value of 6.33, an EV to EBIT of -1.85, and an EV to EBITDA of -2.03, indicating significant operational challenges and negative earnings performance.
In comparison to peers, Datasea's valuation metrics are concerning. For instance, Radware Ltd. has a P/E ratio of 128.27 and an EV to EBITDA of 89.08, reflecting a much healthier financial position. Other risky peers like Allot Ltd. show a P/E of -94.71 and an EV to EBITDA of 150.31, further emphasizing Datasea's underperformance. Additionally, the company's stock has significantly underperformed against the S&P 500, with a one-year return of -49.41% compared to the index's 10.26%.