Is Dolby Laboratories, Inc. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Dolby Laboratories, Inc. has moved from very attractive to attractive, indicating a shift in perceived value. Based on the current metrics, the company appears to be fairly valued. Key ratios include a P/E ratio of 27, an EV to EBITDA of 17.08, and a Price to Book Value of 2.80, which suggest that while the company is not undervalued, it is also not excessively priced compared to its peers.
In comparison to its peers, Dolby's P/E ratio of 25.89 is lower than that of Duolingo, Inc., which has a P/E of 104.90, indicating that Dolby is more attractively priced relative to this competitor. Additionally, Qualys, Inc. has a similar P/E of 25.97, reinforcing the notion that Dolby is positioned competitively within its industry. Notably, over the past year, Dolby has underperformed the S&P 500, returning -7.17% compared to the index's 14.08%, which may further support the view that the stock is fairly valued rather than a bargain.