Is Delta Apparel, Inc. overvalued or undervalued?

As of 4 May 2023, Delta Apparel, Inc. has moved from an attractive to a risky valuation grade, indicating a significant deterioration in its financial outlook. The company is currently assessed as overvalued, primarily due to its troubling financial ratios, including a P/E ratio of 0.00, an EV to EBIT of -3.93, and an EV to EBITDA of -7.36. The return on equity (ROE) stands at a concerning -42.81%, further highlighting the company's struggles.
In comparison to its peers, Delta Apparel's valuation metrics starkly contrast with Wolverine World Wide, Inc., which has a P/E of 34.40 and an EV to EBITDA of 18.97, and Weyco Group, Inc., with a P/E of 9.81 and an EV to EBITDA of 5.75. These comparisons underscore the challenges Delta Apparel faces in the market. Additionally, the company's stock has dramatically underperformed, with a staggering 1-year return of -99.98% compared to a 10.26% return for the S&P 500, reinforcing the narrative of a company in distress.