Is Enpro, Inc. overvalued or undervalued?

As of 6 May 2025, the valuation grade for Enpro, Inc. has moved from very expensive to expensive. The company is currently considered overvalued. Key ratios include a P/E ratio of 45, an EV to EBITDA of 17.07, and a Price to Book Value of 2.80. In comparison to peers, Enpro's P/E ratio is significantly higher than that of Franklin Electric Co., Inc. at 20.97 and Gates Industrial Corp. Plc at 22.68, indicating that Enpro's valuation is not justified relative to its peers.
Despite a strong dividend yield of 62.30% and a PEG ratio of 0.94 suggesting growth potential, the company's return on equity (ROE) of 6.18% and return on capital employed (ROCE) of 8.72% raise concerns about its profitability relative to its high valuation. Additionally, while Enpro has outperformed the S&P 500 over the past year with a return of 29.25% compared to 10.26%, the current valuation metrics suggest that the stock may not sustain this performance going forward.