Is DNOW, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for DNOW, Inc. has moved from attractive to fair, indicating a shift in its perceived value. Based on the current metrics, the company appears to be fairly valued. Key ratios include a P/E ratio of 16, an EV to EBITDA of 7.85, and a Price to Book Value of 1.37. When compared to peers, Core & Main, Inc. has a higher P/E of 29.46 and an EV to EBITDA of 16.78, while UGI Corp. is considered expensive with a P/E of 11.86 and an EV to EBITDA of 8.70.
In terms of stock performance, DNOW, Inc. has underperformed the S&P 500 over the past month and year, with returns of -7.37% and 11.39% respectively, compared to the S&P 500's returns of 0.96% and 14.08%. However, over the five-year period, DNOW has significantly outperformed the S&P 500 with a return of 160.26% versus 91.29%.