Is Diodes, Inc. overvalued or undervalued?

As of 10 June 2025, the valuation grade for Diodes, Inc. has moved from attractive to expensive, indicating a shift in perception regarding its market valuation. The company is currently considered overvalued, with a P/E ratio of 55, which is significantly higher than peers such as Cirrus Logic, Inc. at 15.99 and Power Integrations, Inc. at 82.68. Additionally, Diodes, Inc. has an EV to EBITDA ratio of 13.48 and a Price to Book Value of 1.53, both of which suggest that the company's valuation metrics are elevated compared to its industry counterparts.
The return performance of Diodes, Inc. has been underwhelming, particularly over the past year, where it has declined by 28.96%, contrasting sharply with the S&P 500's gain of 10.26%. This underperformance, combined with its high valuation ratios, reinforces the conclusion that Diodes, Inc. is overvalued in the current market environment.